To anyone planning a home improvement project, an addition or thinking about building a new home: Buyer beware. The price of lumber is hitting all-time highs.
Larry Parker just experienced it. He walked into Lowe's the other day to buy a sheet of OSB plywood for a home project he was doing at his home.
"When I put the OSB in my cart, it was $26.95," he said.
By the time he got to the checkout, however, he says the price on the store's digital signboard had changed.
"It ended up being $33.50," he said.
Prices can go up in minutes
Welcome to 2021's lumber price roller coaster, where the price of a two-by-four can jump in minutes due to a nationwide lumber shortage.
Fortune magazine says the price of wholesale lumber has risen over 200% in the past year, impacting everyone from DIY homeowners to high-end home builders.
"The lumber we buy by the board foot was $400 a year ago, and now it's up to $1,200. So, it is three times the cost," said Brad Olinger, the president of Sterling Homes.
He can't even give potential home buyers an exact quote up front anymore.
"We give an estimate of what the price will be, and then we bid everything out," he said.
He then meets with buyers to show them options for keeping their costs down.
It's not just lumber going up in price.
Almost all home-building products, including plumbing, drywall and even drywall paste are a lot more expensive than they were just one year ago, according to home builder Marc Michaelson, the owner of Michaelson Homes.
"It's incredible," Michaelson said. "We're seeing shortages in plumbing material, electrical materials and drywall. Drywall has doubled in the last year."
Why such high prices?
Customers and builders can blame a perfect storm of pent-up demand, trucking bottlenecks and shortages created by last summer's COVID-19-related lumberyard shutdowns.
Many people held off building new decks or additions in 2020 because they didn't want people in their homes. Now, they are placing orders and fueling demand.
The demand has added $36,000 to the cost of the average $350,000 home just this year, according to the National Association of Home Builders.
Experts are hoping prices — and the building frenzy — ease this fall, when more lumber becomes available. After all, there is no tree shortage.
In the meantime, anyone planning a home project should lock in a price, scale back the size or wait and hope that prices come back down to earth next spring.
__________________________
Don't Waste Your Money" is a registered trademark of Scripps Media, Inc. ("Scripps").
Like" John Matarese Money on Facebook
Follow John on Instagram @johnmataresemoney
Follow John on Twitter (@JohnMatarese)
For more consumer news and money saving advice, go to www.dontwasteyourmoney.com
