Despite an overall drop in the prices of goods for residential construction in November, framing and paneling a house is getting increasingly expensive. Softwood lumber has reached its highest price in over a year after rising almost eight percent in the past three months. Gypsum prices have also seen steady increases since June. Still, the NAHB says, the pace of increases in 2019 for residential building goods is the slowest year-to-date growth in four years.
Prices paid for goods used in residential construction declined 0.4% in November (not seasonally adjusted) according to the latest Producer Price Index (PPI) released by the Bureau of Labor Statistics.
Building materials prices have declined an average of 0.1% per month over the last 12 months, and the price of goods used in residential construction has risen 1.3% in 2019. Not only is that price growth roughly one-third the pace of increases in 2018 (+3.8% YTD), it is the slowest year-to-date growth in four years. In 2015, the price index of goods used in residential construction declined 0.8% between January and November.
The PPI report shows that softwood lumber prices increased 3.5% (seasonally adjusted) in November. The index for softwood lumber has risen 7.7% over the prior three months and now stands at its highest level since September 2018.