Canada was once one of the strongest economies, even during the 2008 recession. Canadians were among the happiest people in the world. But today, the situation has shifted — Canada now ranks 18th on the global happiness scale.
Historically, Canada maintained a strong and friendly relationship with the United States. However, after Donald Trump, a businessman at heart, took office as U.S. President, he pushed to make the U.S. more independent and competitive against China.
China’s rapid growth, especially with the rise of AI and tech apps, forced major countries like the U.S. and Canada to rethink their strategies.
For Canada, being heavily reliant on U.S. trade and welcoming large numbers of immigrants, this transition has created economic pressure. The coming years are expected to be challenging for many Canadian families, and quality of life is already being affected.
Home Renovations and Tariff Changes
Tariffs imposed by the U.S. have impacted the cost of many goods Canadians used to import easily ; including kitchen appliances, renovation materials, and construction supplies.
In the past, many contractors preferred sourcing materials from the U.S. due to proximity and better pricing. But now, with the rising costs and supply chain challenges, Canadian suppliers are also adjusting their prices upwards.
As a contractor, I’ve noticed firsthand how these changes have shifted the market. Many homeowners no longer invest heavily in new home construction. Instead, home renovation projects like basement renovation, kitchen remodeling, or building garden suites in Toronto have become more popular.
What I’m Seeing in the Market
Many customers call us daily asking about services like bathroom renovation, basement renovation, and how to add a second dwelling to their property.
I can see clearly that homeowners are much more careful with their renovation budgets now. People want to update or expand their homes, but they are looking for smart, cost-effective solutions that add value ; not just cosmetic upgrades.
At the same time, smart businesses and homeowner-investors are focusing more on properties that can generate rental income — especially in areas like Toronto, Etobicoke, and Scarborough.
Adding garden suites, legal basement apartments, or second dwellings is becoming a key strategy for increasing property value and monthly cash flow. The demand for additional rental units is growing fast because of the high cost of buying new homes.
Materials Affected by Tariffs in Home Renovation
Because of U.S. tariffs and supply chain shifts, the following materials have seen noticeable price increases for homeowners and contractors in Canada:
- Steel and Metal Products: beams, steel studs, railings
- Aluminum Products: windows, patio doors, garage doors
- Appliances: kitchen and laundry appliances, HVAC systems
- Lumber and Wood Products: framing, plywood, decking materials
- Plumbing Fixtures: faucets, sinks, tubs
- Electrical Components: pot lights, panels, wiring
- Flooring Materials: vinyl floors, engineered hardwood, ceramic and porcelain tiles
These increases affect almost every type of home renovation project, from basement renovations and kitchen remodels to building new garden suites.
Advice for Homeowners and Contractors
If you’re considering a renovation, focus on projects that bring long-term value. Adding a second dwelling unit, a basement apartment, or a garden suite can not only pay for itself but also help weather the economic changes we’re facing.
Over the years, working with homeowners across Toronto and the GTA, I’ve learned that planning ahead, sourcing materials early, and focusing on smart renovations is the best way to stay ahead — both for personal living and investment.
No matter how the economy shifts, homes that offer extra rental potential will always stay in demand.
Conclusion
The results of U.S. tariffs and shifting economic conditions will change home renovation and new construction in Canada. Homeowners in 2025 expect more creative, cost-effective ways to improve and expand their living spaces and control family monthly payments. Adding second dwelling units, garden suites, or legal basement apartments has become a strategic movement for the contractors, and we should explain and show the homeowners why it’s worth it if it is worth doing it now instead of waiting for later.
As the market continues this way, careful planning, proper material selection, and focus on long-term goals will be the keys to successful renovations in Toronto and across the GTA. Whether you’re a homeowner or an investor, now is the time to think smart about your next renovation project.
FAQ Section
Q1: How have U.S. tariffs impacted home renovation costs in Canada?
U.S. tariffs have increased the price of steel, aluminium, appliances, lumber, and plumbing fixtures, making home renovations more costly across Canada and harder to make decision .
Q2: Why are more homeowners choosing renovations over buying new homes?
Due to high property prices and rising material costs, many homeowners find renovating their current homes more affordable than buying new ones and save many extra cost related to moving also custom made their home for themselves.
Q3: What types of renovations add the most value today?
Projects like legal basement apartments, garden suites, and second dwelling units are highly valuable because they can generate rental income and increase property value significantly .
Q4: Which renovation materials are most affected by tariffs?
Steel, aluminium products (like windows and doors), kitchen appliances, lumber, plumbing fixtures, electrical components, and flooring materials have increased prices.
Q5: How can homeowners save money during a renovation?
Planning early, working with trusted contractors, sourcing materials in advance, and focusing on high-return projects like rental units or basement apartments helps them to make the best option after planning.