Page 6 - Demo

6 LBMAO Reporter - January-February 2026 www.lbmao.on.caLOOKING FORWARD TO 2026!TREVOR SMALLLBMAO President MESSAGE FROM THE PRESIDENTI always love the end of the year. Lots of time with family and friends, great food %u2013 many times too much. In our family there is always a lot of stories and laughter. As I reflect this year had some great moments %u2013 I had a new granddaughter born in August. That makes number three for us! There were also a number of sad moments %u2013 I had a close family member pass unexpectedly this fall and our family had some significant health setbacks during 2025. It is a great time to reflect on this past year and look forward to 2026. Many in the lumber and building materials business in Ontario will not look fondly on 2025. We had tariff issues with our largest trading partner. These had significant pricing effects on steel, aluminum, and lumber. The past year was noteworthy for the record low prices for lumber and low numbers of new home starts across Ontario. 2025 will not be a year that most suppliers and retailers in Ontario will want to remember. While there were solid areas of sales and building activity, a large portion of retailers and suppliers in southern Ontario saw declines or were flat this year. What will the coming year bring? If you are a supplier or retailer who supplies a large amount of product to the condominium market in Ontario things will continue to be slow. The condo market has been growing at an incredible rate since 2010, but that market has cooled. A few of factors lead to the rise in this market were: The rapid growth of foreign students coming to Ontario to study made condos a great rental investment. Speculators who bought before the units were built, paying minimal amount of money as downpayments and then flipping the units before they were finished. These investors cashed in on the timing of the market to make substantial profits. Government pressure on developers to build high occupancy housing near transit areas. The goal was to put people closer to transit to reduce their commute. The number of foreign students allowed to enter Canada to study has been drastically reduced. This has diminished the need for the condos, putting the speculator investors in a challenging spot. They now must pay the bills for condos when they are finished. These investors may be underwater on the value of these homes, as the rental prices have dropped and many investors are fire selling to get out from underneath a debt they cannot afford. Positive signs for 2026There are many positive signs for 2026 for suppliers and retailers of building materials. With mortgage rates down over the past 2-1/2 years, homes are once again becoming more affordable to many in Ontario. The town we live in currently has a number of single-family detached homes listed for less than $400,000. Why does this help the sales of lumber and building materials? The real estate market has a huge bearing on the sales of building materials. When people are buying existing homes that means the seller will be looking for a new home as well. The move up market drives a lot of purchases of building materials for presale renovations as well as renovations after new purchasers have moved in. We can all think of all the paint, flooring, cabinets, countertops, back splash, trim, hardware, decks, rec rooms, and basement renovations that come before or after a real estate transaction. This also means that some of the sellers of these properties will be purchasing new homes. Some purchasers are first time buyers; most are buyers who have something they have to sell first. As an industry, the lumber and building materials business has been solid since COVID. Our industry is used to the ups and down cycle, but slow sales is never easy. We need to approach 2026 cautiously but believing this will be a solid year. Continued on page 22...