Record-High Lumber Prices Stifle Builders and Housing Affordability
Record-high lumber prices are threatening to halt the residential construction sector, and in turn, hold back the economy. Chuck Fowke, chairman of the National Association of Home Builders, says the price of lumber has hit prices 170% higher than the past 10 months. NAHB continues to request assistance from the White House in requesting domestic lumber producers to ramp up production and end tariffs for Canadian lumber shipments. One NAHB member says the price of an identically-sized home increased from $35,000 last year to $71,000 this year. Access to building materials is the main concern for 96% of builders, according to a recent NAHB survey.
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Lumber price spikes are not only sidelining buyers during a period of high demand, they are causing many sales to fall through and forcing builders to put projects on hold at a time when home inventories are already at a record low.
Impact in Local Markets
“The increase in lumber prices is forcing our company to delay construction starts, which will only exacerbate the lack of supply in our market,” said NAHB First Vice Chairman Jerry Konter, a home builder and developer from Savannah, Ga.
Alicia Huey, a high-end custom home builder from Birmingham, Ala., and second vice chairman of NAHB, said that the price of her lumber framing package on an identically-sized home has more than doubled over the past year from $35,000 to $71,000. “This increase has definitely hurt my business,” she said. “I’ve had to absorb much of this added cost and even put some construction on hold because I would be losing money by moving forward.”