August marked the first month of building materials price drops this year, decreasing 1%, according to data from the Bureau of Labor Statistics. Last month was also the second month in a row for slowed or declining price growth for relevant goods, reports The Real Deal. Still, construction materials remain 14% higher than at the end of 2020 and some materials are on upward trends. Steel mill product prices were up 5% in August from July, ready-mix concrete went up 2%, and drywall remained elevated but stable.
Softwood lumber, which has been on a roller coaster ride all year, is driving the overall dip in costs. Prices for the material have been sawed in half since topping out in May 2021. Still, the price for softwood lumber is 24 percent higher than pre-pandemic levels in February 2020.
The homebuilding industry continues to face other challenges, such as labor shortages. Meanwhile, the gulf between home supply and demand continues to grow: U.S. Census numbers show 12.3 million households were formed from January 2012 to June 2021, but only 7 million single-family homes were built during that period. A Realtor.com analysis shows that the gap – 5.2 million – is 1.4 million higher than it was in 2019.