If you’ve been looking at buying a new build or even doing renovations at your current home, you have likely noticed that lumber has gotten extremely expensive as of late. While doing at-home renovations used to be an affordable way to make progress towards your dream home, the price tag of anything involving building supplies has been steadily climbing.
This is true not only for consumers, but also for professional developers—and when developers’ costs go up, they have to pass it onto the consumer. If you’ve been shocked by how expensive newly constructed homes are costing lately, you aren’t alone! Below, we’ll look at the reason behind these suddenly high lumber prices and what it means for current (or future!) homeowners in the Charleston housing market.
Why Lumber Prices Have Gotten So High
In short, the lumber prices we’re seeing these days are a direct result of COVID-19—but likely not for the reasons you think. While it is true that the pandemic inspired many people to tackle their long-delayed home renovations, that’s only part of the puzzle. As the pandemic began to develop in early 2020, many lumber mills reduced production in anticipation of a reduction in sales. The recession of 2009 hit the lumber industry hard, causing suppliers to react cautiously to a new crisis. By the time they realized that the pandemic would actually be favorable for lumber purchases, the mills were already behind.
What High Lumber Prices Mean for Home Buyers
Because builders and developers are having to spend more to build the same homes, these high lumber prices have a trickle-down effect on the market, leading to inflated home prices on all new construction. The National Association of Home Builders estimates that the cost of an average single family, newly constructed home has surged by more than $35,000 due to builders passing along their high costs to potential buyers.
While this inflation certainly can’t last forever, for those who are itching to buy a new construction home right now, it can be daunting to say the least. If you are currently in the market for a home, don’t despair! The good news is that eventually, supply will catch back up with demand, which will lead to a sharp fall in lumber prices that will also be passed along to the consumer. Right now is still a great time to look for a home in order to get an idea of what you want for your next purchase. Even if your current wishlist is out of budget it may not be for long—and if you’re open to other ideas, Charleston has plenty of incredible historic homes to choose from that you can make your own!
Are you ready to start your Charleston house hunt? We’re here to help! Whether you just have questions about the market or are looking to dive right in, we’re here to be a resource for you every step of the way. Contact us today to learn more.
