PRESIDENT’S MESSAGE CHAOS PRICING A ccording to many bank economists, Canadian construction prices began a “stabilization” phase in early 2026. Frankly, I’m not seeing it. In 2021-2023, it was COVID and hyperinflation that caused pricing chaos, and in early 2025, it was Trump’s global trade war. As a result, pricing stability was shaken to its core and costs went through the roof. In theory, what goes up must come down. That is basic supply and demand economics according to my third-year economics professor. So, why haven’t prices come down? The reign of terror that hyperinflation caused is over, and optimists who believe Trump’s bark is worse than his bite see a restored CUSMA trade agreement in our not-too-distant future. Perhaps that isn’t so far-fetched. God knows our survival depends on trade. And even though they are less reliant on exports, Americans also benefit from some form of free trade. The U.S. economy is booming, which is bad news for Canadians in terms of a new trade agreement. However, high consumer prices south of the border and the inevitable public outcry about the cost of living for U.S. consumers is good news. Unfortunately, timing is everything, and the clock is ticking. Trade wars aside, it is uncertainty that drives volatility and it is uncertainty that has caused Canadian construction prices to remain at record-high levels in 2026. Simply put, cost predictions are impossible in uncertain times because you can’t price the fear of uncertainty. Statistically, Canadian construction prices in the short term are indeed more stable. Year over year, we saw residential and non-residential costs rise three per cent and 4.1 per cent respectively at Q1 2026. And increases in Q4 2025 were under 0.5 per cent for both residential and non- residential, which is surprisingly modest, all things considered. But this so-called stability isn’t sustainable without a U.S. trade agreement. That, we know. Add to that, our national economic uncertainty. Canada is the only G20 country that can’t seem to find a way to grow its economy. Worse still, some economists argue our GDP figures are misrepresented with accruals and unrealistic accounting practices, and that we would otherwise be in a recession as we speak. Either way, our economy is flat when it ought to be growing. Now, let’s look beyond tariff pressures and our lackluster economy and do a deeper dive into construction price stability. We know labour is also a primary driver in construction price stability. How can skilled labour shortages and new collective union agreements not drive construction costs up? And what about new regulatory changes focused on energy efficiency and climate resilience? Who among us can keep up with energy-related building code changes that are driving up new development costs when we so desperately need savings? The question we are asking ourselves today is whether the so-called construction cost “stabilization” phase is real and 6 Quarter 1 2026 BUILDERSDIGEST
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