Lumber Prices on the Rise Again; Reflect in Home PricesJanuary 11th, 2022 by Editor
Falling lumber prices have rebounded and the associated ripple effects are following suit. The National Association of Homebuilders (NAHB) reports new home prices have increased more than $18,000, as lumber prices have tripled in the last four months. The increase “also added nearly $7,300 to the market value of the average new multifamily home,” which the association says raises rent nearly $70 per month.
NAHB points to Random Lengths in reporting that at the end of December, “the price of framing lumber topped $1,000 per thousand board feet — a 167% increase since late August.”
Lumber prices first skyrocketed in the spring of 2020, when COVID-19 shook the United States. The building industry was left to figure out if workers were “essential” or not, and many consumers whose jobs were either furloughed or transitioned to work-from-home status took a new interest in home do-it-yourself projects, creating an unprecedented demand on materials. The NAHB points out that lumber prices peaked “$1,500 per thousand board feet in May 2021” before starting to return to normal pricing for a short time.
The association attributes this new surge in pricing to three things:
- Ongoing supply chain disruptions
- A doubling of tariffs on Canadian lumber imports into the U.S. market that increased price volatility
- An unusually strong summer wildfire season in the western United States and British Columbia
With a much different source of the recent price increase the NAHB is taking proactive measures. Representatives of the NAHB “continue to work relentlessly with the White House, Congress and lumber producers to resolve lumber and other building material supply chain disruptions, increase lumber production and bring material prices lower.”