Currently Reading

Building Material Costs Are Top Concern Despite Builder Confidence

Advertisement
Building Materials

Building Material Costs Are Top Concern Despite Builder Confidence


May 18, 2021
Lumber
Photo: Volodymyr | stock.adobe.com

While low existing home inventory, mortgage rates, and a growing number of prospective buyers keep builder confidence up, building material costs threaten affordability and availability. According to the National Association of Home Builders, rising home prices resulting from increased land, labor, and material costs put first-time and first-generation homebuyers at risk for losing a purchase. NAHB calls on policymakers to recognize the threat and to ramp up production of domestic construction materials such as lumber and steel, in addition to pausing tariffs on imported materials. NAHB says home prices will continue to rise through 2021.

In recent months, aggregate residential construction material costs were up 12 percent year-over-year, and our surveys suggest those costs are rising further. Some builders are slowing sales to manage their own supply-chains, which means growing affordability challenges for a market in critical need of more inventory.

With labor and lot availability a challenge in many markets, new home prices will rise through 2021.

Derived from a monthly survey that NAHB has been conducting for 35 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.”

Read More
 

Related Stories

Building Materials

Lumber Falls to Lowest Price Since March

Lumber prices dropped 5% on Friday to the lowest price since March and 37% since prices hit a peak in May. Lumber futures decreased for the eighth…

Housing Giants

The Supply Chain's Perfect Storm

Never before have home builders had to navigate a market where houses are pre-selling fast while the cost of so many resources is rising and so many supplies are constrained at the same time

Construction

Lumber Veteran Sees Holding Off on Construction as 'Sensible'

A National Association of Home Builders’ survey found 19% of builders are delaying building in order to mitigate high lumber costs, and one lumber…

Advertisement
Advertisement

More in Category




Advertisement
Advertisement

Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.


Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Subscribe
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.