Have Material Costs Gone Up?
Building Material Price Trends
The prices of building materials have been on a roller coaster over the past year. We have seen softwood lumber otherwise known as framing lumber more than triple in price last May. In recent times, the price of wood has come back down, but unfortunately last month, (November) we are seeing prices of lumber slightly increase yet again due to labor shortages and supply cuts. Other building materials like concrete, steel, copper, and aluminum have been affected since the lockdowns. As a custom home building company, this is something that we need to pay attention to as it affects our day-to-day operations. To learn more about building material price trends read on.
Softwood lumber is what we pay the closest attention to. At BBC we specialize in new builds and remodels. Around 97% of our new builds are built of softwood. The National Association of Home Builders recently drafted an article called, Framing Lumber Prices, they made a graph that shows the price fluctuations of framing lumber over the last year. The article states, “The information is sourced each week using the Random Lengths Framing Lumber Composite which is comprised using prices from the highest volume-producing regions of the U.S. and Canada.” During the month of May, we saw prices get as high as $1,670.50 per thousand board feet.
Concrete is another substance or material that is commonly used to build or help build a home. The foundation of almost every home starts with concrete, so this is another material that we like to track. In the Midwest, Ready-Mix Concrete has been on a steady incline over the past 12 months. The National Association of Home Builders shared a graph to show the price trends dating back to the year 2000.
Aluminum prices are up 70% from the pre-pandemic amounts. National Association of Home Builders CEO Jerry Howard, said: “Aluminum is integral to residential construction and used to make everything from siding and gutters to insulation, nails, and HVAC equipment.” All building material that is made with aluminum have also increased. “
After doing some research on the trends of building materials, it is apparent that prices will continue to fluctuate as they have been for the past year. There is talk that prices will steadily rise into next year. We hope that prices do not jump higher than what they were last May, and that people can go back to work to help regulate lead times. For our company, we have taken away one thing from these unpredictable times, and that is that preparation is key. Long lead times can be dealt with, it just means we must be on top of selections so we can put an order in early enough where we will not have to wait on products.
Interview with Jesse Annala from Proctor Builders
How are your lead times currently looking?
Well, it depends, it is hit or miss on any given product. Some products that consistently have longer lead times are garage doors which on average are 8-10 weeks out, plus 3-4 weeks for the springs. Windows are another one, they are a minimum of 12 weeks out, Marvin Windows is around 20 weeks out. Treks decking might have some or none just depending on the item at the time.
What is the reason for this?
Shipping, there is a shortage of truck drivers and there have been manufacturing issues along the way. Orders were not stopping during the shutdown, so naturally, it’s hard to play catch up when we have no one to ship it. Not everyone went back to work, and it is affecting many of the lead times.
What is the average lead time for common building supplies?
OSB is hard to get, we are often low or just completely out. Lumber is available, but it fluctuates depending on the day. It is hard to accurately predict lead times for building supplies as it has been different every day.
Do you see the lead times getting better or worse?
I do not see them getting better anytime soon, the next 12 months might not get any better. Which has a chain effect on every company. My best advice to you or any other company is to plan ahead. Plan way ahead to give yourself a better chance of receiving the material on time.