Record Lumber Prices Have Added 14K to the Cost of a Single-Family Home
Lumber products have been subjected to extreme price volatility throughout the pandemic, adding an average of $14,345 to the price of a new single-family home and an average $5,511 to the market value of a new multifamily home, NAHB Eye on Housing reports. The increase in multifamily value brought on by fluctuating lumber prices equates to households paying an additional $51 a month for rent.
Along with costly softwood lumber products, plywood, OSB, particleboard, fiberboard, shakes, and shingles saw notable price changes throughout the last several years, forcing builders to adapt and homebuyers to expand their budgets.
The bottom line is that the changes in softwood lumber prices that occurred between April 2020 and July 2022 have added $14,345 to the price of an average new single-family home and $5,511 to the market value of an average new multifamily home. Based on the average rent-to-value ratio in most recent HUD/Census Rental Housing Finance Survey, the increase in builder cost and market value for a multifamily structure means tenants pay $51 more a month to rent the average new apartment due to the change in softwood lumber prices.