Date: 30 June 2026
In the session “Beyond the Headlines | Inflation, Interest Rates, Housing Supply in a Shifting Economy,” economist Robert Dietz, PhD (National Association of Home Builders), shared the state of the U.S. residential market, and Louis-Philippe Champagne (Canadian Construction Association) covered Canada’s biggest economic challenges in a complementary session: “Uncertainty and Opportunities | Navigating Change in Canadian Politics and Trade Relations.”
U.S. Economy in Flux
“There is slowing economic growth at this time,” said Dietz. “There is a 40% probability of a recession over the next three quarters. To be clear, a probability of 20% is normal, so this is somewhat elevated. Energy prices have sparked consumer inflation. 2025 started slowly with the economy. Uncertainty around tariffs toward the end of last year did not help.”
Consumer Debt
Other factors have slowed growth, Dietz said, including student loans and other types of borrowing. “More and more car owners are underwater with their loans,” he said. “That is a drag on consumer spending. A lot of people are using credit cards as loans right now.”
Data Centers
On the positive side, data center construction spending has really taken off since 2022, when ChatGPT was released to the public,” Dietz said. Growth moderated in 2025. “Data centers are driving non-residential construction,” he explained. “The demand for traditional homebuilding is still there. The deficit is narrowing, but affordability challenges will persist.”
Lumber Prices
Construction costs are also rising, said Dietz, partially because of higher diesel and gas prices. “Lumber prices have been roughly flat since 2023,” he said. “There is a risk of higher lumber prices later this year because we get a quarter of that from Canada. The current tariff rate for [lumber] there is twice what was in place at the start of the second Trump term.”
Remodeling
Finally, remodeling is showing growth for residential construction and is gaining market share. “There will be a solid demand for housing during the second half of the decade due to the aging population,” Dietz predicted.
Canadian Politics, Trade Relations
While Canada is technically in a recession, Champagne began, it is not unexpected. He cited four challenges the industry is facing in Canada: infrastructure investment, workforce shortages, outdated procurement and supply chain disruptions.
Infrastructure
In the area of infrastructure, help is on the way, according to Champagne. The Government of Canada announced $115 billion in infrastructure over the next five years, explained Champagne. “This is a significant amount of spending,” he said. “It includes $51 billion for local infrastructure such as housing and transportation. All of this will require fenestration products.”
Workforce Shortages
Champagne shared that vacancy levels have remained stable and above the pre-COVID average. However, the labor force is shrinking due to decrease in population. “Labor demand in the construction sector has grown faster than in other industries,” said Champagne.
Outdated Procurement
A concerning trend that has been observed is the procurement of progressive, collaborative contracts using traditional evaluation structure, said Champagne. “Project value assessments should include operations and maintenance components,” he advised.
Supply Chain Disruptions
Higher oil prices raise diesel costs for on-site operations and the cost of petroleum-based building materials. This can include piping, roofing membranes, insulation and adhesives. “A lot of products are not manufactured in Canada,” said Champagne. “Wide-flange beam steel is of significant concern. Same with float glass.”
Finally, trade policies that could impact Canada include a 25% tariff on U.S. and Chinese steel. “We don’t produce architectural steel in Canada, so this is a problem,” he concluded. “What’s happening in the U.S. will define how we work together in the future.”
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