The asymmetric effects of softwood lumber duties, tariffs, and mortgage rates on housing payments
Bibliographic record
Abstract
• A 25% lumber tariff increases monthly mortgage payments by $26-$41. • Tariff impact weakens by 36% as markets adjust from rigid to flexible conditions. • 19 basis point rate reduction completely offsets 25% tariff impact on payments. • Monetary policy is the dominant driver of housing affordability over trade policy. This paper quantifies how softwood lumber tariffs propagate through the U.S. economy to affect homebuyers’ monthly mortgage payments, comparing this channel to direct mortgage rate changes. Using an integrated Armington-Leontief framework with 2022 IMPLAN data, we trace a tariff shock on Canadian softwood lumber into residential construction costs and mortgage payments. For a baseline $420,000 home with a typical principal-and-interest payment of about $2,190, a 25% tariff raises monthly payments by $26-$41 (1.2%–1.9%), depending on market flexibility. In contrast, a one percentage point mortgage rate increase raises payments by $229, nearly six times larger. The tariff impact weakens by 36% as markets adjust from rigid to flexible conditions, whereas mortgage rate effects persist throughout the loan term. A relatively small 19 basis point rate reduction completely offsets a 25% tariff impact. Our results show that for housing affordability, monetary policy dominates trade policy, with critical implications for the ongoing U.S.-Canada softwood lumber trade dispute.
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How this classification was reachedexpand
Full frame distilled prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.
Codex and Gemma teacher scores by category
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.001 | 0.000 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.000 | 0.000 |
| Bibliometrics | 0.000 | 0.001 |
| Science and technology studies | 0.000 | 0.001 |
| Scholarly communication | 0.000 | 0.000 |
| Open science | 0.000 | 0.000 |
| Research integrity | 0.000 | 0.000 |
| Insufficient payload (model declined to judge) | 0.000 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one teacher head, not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".