How Current Rising Lumber Prices Are Affecting the Housing Market
The pandemic has hit the United States hard, and not just from a health perspective. The economy has taken hits in numerous ways, and when it comes to lumber prices, 2021 doesn’t seem to be the year that fixes everything. So far this year, the rise in the cost of lumber has tacked approximately $36,000 onto the cost of the average single-family home in the U.S. We took a look at what’s causing these high prices, how they’re affecting the housing market, and how we’re protecting our customers from these inflated prices at Landmark Fine Homes.
Why Are Lumber Prices So High?
The reason we see lumber prices going up dates back to a year ago, when lumber tariffs created an uptick in lumber costs. Once the pandemic hit, lumber mills slowed or even stopped production, not just because of quarantine restrictions but also because builders were anticipating a housing slump. The slump never arrived, and in the past year lumber prices have gone up at an unprecedented rate. In fact, lumber prices today are about 340% than they were a year ago.
What’s more, there’s an historic shortage of existing homes that’s making people opt for new construction. Rather than new homes making up 1 in every 10 home sales, they’re now being sold at a rate of 1 in 4. Builders are in fierce competition over the price of existing land, to keep up with the extraordinary demand for new housing. The result of all these factors is a further escalation of new home pricing. Consider this: While the price of other materials, like drywall, is also on the rise, lumber isn’t just used in the construction of a new home’s frame. The rise in lumber prices affects the cost of cabinets, doors, windows, and flooring, too.
When Will Lumber Prices Return to Normal?
Lumber prices might never get back to pre-pandemic rates, because the demand for lumber is expected to continue to rise. Eventually, lumber mills will catch up, but experts disagree on when that will happen.
How We’re Protecting Customers from Ever-Rising Lumber Prices
This may seem like bad news, but if you’re interested in building a new home, we’ve got some good news for you. Landmark Fine Homes is committed to protecting our customers from rising lumber costs during their home build process. Once you sign a contract with us, we lock in the price of your home at a fixed rate. No matter how high the price of lumber rises, Landmark will absorb the extra cost. This is a unique proposition, but it’s not surprising for those familiar with our company. We’ve always believed in building not only high-quality homes that meet our buyers’ needs, but also excellent relationships with the homeowners in our communities.
If you’re looking to create your dream home, Landmark Fine Homes has beautiful new and custom-built homes in a variety of sizes and floorplans. Our homes are also energy-efficient and built with the utmost attention to detail. Make your next house the home of your dreams by contacting Landmark Fine Homes today!