JACKSONVILLE, Fla. – Lumber prices in the U.S. are soaring.
The price of lumber more than doubled over the last year to an all-time high, reflecting strong demand for new construction and home remodeling, and pandemic-related problems limiting production.
This surge has added more than $24,000 to the price of an average new single-family home, according to an economist with the National Association of Home Builders.
“What was pre-COIVID eight to 12 dollars is now 30 to 45 dollars,” explained Ron Harris, a realtor and general contractor.
What else is contributing to the spike in prices?
“Increase in demand for houses -- primarily due to low interest rates,” Harris said. “Demand has risen, at the same time COVID has shut plants down.”
Harris explained the increase in demand for new construction is having an impact on other things too.
“It’s across the board. It’s electrical. It’s copper. It’s concrete. It’s windows,” he said.
Harris encourages people to be patient with their builder and their contractors, as the low supply of lumber is impacting everyone.
“I think people are going to have to wait until this settles, and I would say it’s beyond 12 months from now before there’s any change, but I just don’t have a crystal ball,” Harris said.
Several market trends are driving strong demand for homeownership. Apart from low mortgage rates, Americans forced to work from home in the pandemic are seeking larger homes. And more millennials are entering the market.
While the price of lumber, cement and other construction materials fluctuate constantly, the volatility has worsened over the past year as the coronavirus pandemic led to factory closures, a shortage of truckers and other logistical issues that have made the normally smooth supply chain unpredictable. That’s meant shortages in items like windows and faucets, translating to higher costs and delayed construction projects.
The pandemic has also left some municipalities short-handed, which can mean delays in approving building permits, inspections or the process needed to get land cleared for new construction.
The Associated Press contributed to this report.