Falling lumber prices are a start, but how do we fix the housing market?

Scott Rogers once again has his finger on the pulse of the residential construction industry. His blog post about falling lumber prices is great news. I have seen the proof as R. S. Monger and Sons Inc. has been getting shipment after shipment in of wood products to restock their warehouses. Increasing prices for lumber has had an incredibly painful impact on home construction in our area over the past 6 months. Falling lumber prices are a start, but how do we fix the housing market in our community?

Lumber made the news as prices jumped dramatically just as a potential gas shortage made the news and then became reality. I am not saying it was a manufactured increase, but rather a result of a lot of factors from plant shutdowns to increased demand. However, it is not just lumber that is impacting the increased costs for construction. We are seeing an increase in all material prices. Where manufacturers used to do 1 or 2 price adjustments in a year, they are now doing it monthly if not more often, and up each time. We have also seen a dramatic decrease in the available construction industry workforce over the last 10 to 20 years and that does not seem to be changing. Predictions are that in the US alone we will need 430,000 more construction industry workers in 2021 than in 2020. We are also still seeing supply chain issues, yesterday a delivery truck showed up at a job site without the materials on the truck that were ordered? Why show up, I don’t understand. It is also hard to find products with any parts or resins coming from overseas right now, causing backorders and changes to selections that were made a couple of months ago. And now national builders have come into our market with the buying power of a national builder that does not source materials or labor through our local market – what changes will that bring?

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As we look at many of the challenges our community face, many of them can lead you back to the need for more affordable housing options. The availability of affordable housing options is going to take time to improve and only through zoning changes, more labor entering the construction industry (college is expensive and construction jobs pay really well), and material prices falling. While lumber prices falling will help, it is just a small part of the systemic problem we need to overcome.

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