There Goes Lumber Prices… Again! What’s Fueling the Surge?
Download MP3🔍 Episode Description:
- We’re keeping a close eye on lumber prices—not just for you, our listeners, but also for our own projects.
- A few months ago, there was an expectation that lumber prices would come down as the real estate market cooled.
- While there was a slight softening, prices quickly bounced back with just a minor shift in mortgage rates.
- A mere 11 basis point drop in mortgage rates (just 0.1%) caused lumber prices to spike 7%.
- Prices remain below $1,000 per thousand board feet but are now hovering in the $600 range.
- This shows how sensitive the lumber market is to even small signs of recovery in construction or real estate.
- The days of $400–$500 lumber may be gone for good due to several underlying factors:
- Ongoing housing shortage
- Persistent demand despite high home prices and interest rates
- Buyers adjusting to the "new normal" of high costs and higher interest rates
- Once developers and contractors adapt, the construction market is expected to fire up again—boosting lumber demand.
- Labor shortages in lumber mills continue, with companies offering high wages and signing bonuses.
- The supply chain remains tight, even with reduced demand, due to a lack of skilled workers.
- People still need homes; demand hasn’t disappeared—just adjusted.
- Even homes priced well above previous years are selling.
- There's a persistent shortage of inventory, pushing prices and demand higher.
- Many homes today are older and in need of repairs, updates, or additions—all of which require lumber.
- Since the 2008 housing crash, fewer homes have been built, increasing the need for remodels and new construction.
💬 Listener Feedback:
Tell us what you think about today’s episode. Are lumber prices here to stay at these elevated levels? Leave a comment and join the discussion!
Tell us what you think about today’s episode. Are lumber prices here to stay at these elevated levels? Leave a comment and join the discussion!
