we just got the bid on our 3200 sf custom build. our builder told us that the windows, doors and framing for a comparable house they bid in may was $60k less than ours. So, it seems like a similar increase as yours. Unfortunately for us, I don't think an adjustment in lumber is enough to get us down where we need to be budget wise so we had to scrap our build. however, our builder did say that we could try bidding again in December, which may get us the best deal. (I guess most trades do 3% price increases in January). so maybe you want to consider trying again before the end of the year.

Up, Up and Away!

It's pretty brutal. Lumber pricing is crazy, mills are underperforming and housing demand is up.

My expectations (and views of lumber futures) until last week were that lumber prices would subside in early 2021 but now I wonder....

There are many factors that impact the overall price of a home and in aggregate, they usually are increasing over time due to higher demand vs supply, higher costs of manufacturing, higher local labor wages. Not all to blame on wage increases, but look at fuel, taxes, regulation, tariffs, etc. We almost always see cost increases early in the year.

With this increased demand production builders are facing, there will be more demand for lots/land and expect that cost to also get passed along as there are new values for the land under the home you want.

We were doing a remodel in 2005 when Katrina hit. Shingles and decking prices all skyrocketed. You may have something similar happen during your build. Hope not.

I don’t know much about building or what you have to do, but I would be shocked if your builder charged you less for putting in a foundation, framing, roofing and siding in the winter in the northeast.

A fishing buddy works for the local mill, in CA, for months, his job was not considered essential, and the mill (600 employees) shut down.

This is due to the covid virus.

I believe we're seeing the effects of the 2008 recession on labor. Guys who would have 12 years experience right now, just the time they'd be likely to go out on their own, saw the devastation wrought upon their fathers and uncles in the trades and said "To hell with this, I'm going to chiropractor school."

You're not going to have any problems finding someone to crack your back, but good luck getting a decent framer, even when you find some wood for him to work with.

Restarting a sawmill is a piece of cake compared to filling the labor void created years ago. You folks waiting for prices to come down are self-deluding.

We started our new build in March/April and we seriously debated holding off because of Covid but we are SO thankful we got our lumber before prices increased and supply diminished. We've had a little longer wait times on millwork but nothing terrible yet. DH watches the markets and strongly feels it's going to be a long time before pricing comes down, especially since we will probably start having mass inflation from all the money being put into circulation.

@User This is interesting as construction has been considered essential in CA and most of the industry has continued working except in a few counties. CA has also allowed the big box home improvement stores to remain open and they've been packed as have been most retailers related to home improvement.

I'm guessing covid safe practices can happen at a saw mill. The mills are the current bottleneck impacting lumber prices.

@Joseph Corlett, LLC I hear you. Labor is scarce. Keep them paid, happy and a well organized path of work ahead.

The mill is in Eureka. They were shut down for ~2 months.....around April-May....

maybe the mill was closed to install covid safety equipment. He thought it was because his job was considered non essential.

SOunds right. My framing expense went up by $10,000 in materials only. This was due to the increase in the cost of lumber between December and April.

My DS and her hubby started their new home build (he is a contractor) last fall. putting in the foundation and ordering much of the things they would need.

But now they are seeing the prices increasing, by a lot.

He doesn't think prices will go down.

We are just starting a gut job remodel. A few weeks back, our contractor asked for a down payment to secure lumber purchase prior to the most recent price jump, which we did and avoided a large increase.

Lumber and home improvement industries were caught unaware of how much remodeling, home improvement and building would occur during Covid. Materials are scarce.

FWIW my builder ordered our lumber just before what he told me was a 40% price increase!! and some lumber is tough to come by currently. Pressure treated and sheathing for sure.

I saw elsewhere that some builders were proposing using ICF (insulated concrete forms) instead of wood framing, due to the lumber cost. From my quick look, it is a substantially different building process. Therefore, it doesn’t seem like an option that a client could propose to a builder with no ICF experience. Interested if anyone has knowledge of this option though.

We had a hard time even getting the lumber without a wait. There‘s high demand for it right now. The lumber company told us people aren’t traveling and are instead staying home and doing home improvement projects.

Our lumber package was bid before March. We are getting trusses today and all framing should be done in 2 weeks. Our final lumber bill is expected to come in at 9% under the bid.

(not a pro) Paint prices have gone up, too. I signed a contract for interior painting in January or February. By the time they could come in and paint (late June / early July) paint had gone up noticeably. Don't know the exact amount, but seems like it was about 25%.

We're building right now. Contract signed in late March. The general contractor says that lumber prices have gone up 30% here (North Carolina) but we're under contract so our pricing won't change due to material costs.

We're building a small horse farm so checked into pricing for fencing material this past week and fencing materials ae up about the same rate increase ($3 more for each post and each board). For fencing materials there's abut a 2mo wait for orders to be fulfilled

We did our design before covid and decided to put on our project on hold when covid hit due to employment instability. We recently restarted the project and just got the updated budget from our builder. Total cost went from 650K in March to 706K in early Dec for a 3800 sqft house. Framing material cost doubled. We were expecting an increase in cost, but not this much. Unsure if we should pause again and see if the lumber cost will decrease next year. As most of you said in this thread, this is highly unlikely, and waiting only will result in a cost increase.

We too put off our build from last spring to next and in meeting with our builder last week he said to expect about a 10% cost increase overall, which would be about $45K for our 2000sqft custom home. Regrets for sure, but we did the best with the information we had at the time.

We are currently trying to start our build, but we are seeing another price increase, due to increase in material costs (along with lumber). We are now looking at about a $45,000 price increase. I’m not sure what we are going to do. 😕

We have 1,000 fewer square feet, and our build is basically a rectangle with a jog or two in it. Broke ground this summer. Framing now. Expected to run $15,000 over budget on framing/sheathing. So yeah, I'd say your numbers sound right, and if anything, they might be a touch low.

HU-248891484-

So you started this thread 3 months ago, wondering about whether to proceed at that time. Did you decide to go ahead then, or are you just starting now?

Glad we forged ahead and didn’t wait!

Kudzu9 We are hoping to start now, but the price has increased even more...

Prices are rarely held beyond 60 days. There will be a bunch of trade & supplier increases in early 2021.

A few hours after I wrote this I received notice of a 10% drywall material increase.

Price hike seems very true/honest for an updated quote.

Many raw materials are up 30-45% or so. Mainly lumber and composite products, since all the mills were forcefully shut down all year... Besides supply/demand, you're paying overtime for them to get caught up, inflated wages, expedited charges, etc. Then there's also delays and backorders that will be a pain in the butt too. Some projects aren't able to source the lumber they need, man-made products, composite siding like LP Smartside or Hardy...

Almost every product is up due the above wage situation since laborers have been paid extra to not work most of this year. Then there are other products (shingles, etc) that don't make sense why they have extreme price increases...

Once the price is up where it is, it's hard for companies to come back down (because they can get that price), we just have to wait (months) for good old fashioned competition to get prices back in line.

Just pray they don't pay everyone extra to be unemployed all 2021 also or this crap won't go away for a year plus...

Wondering how if employer was closed employees receiving unemployment compensation would drive the price up? I understand employers when allowed to reopen paying employees higher wages, bonus's and overtime but employers quarterly pay into unemployment compensation unless they pay their employees on a cash basis and report only the minimum.

From NAHB on Dec 9th:

<blockquote>After drifting lower from mid-September to mid-November, lumber prices are on the rise again. Prices peaked at an all-time high of roughly $950 per thousand board feet in September before gradually moving down to around $550 per thousand board feet last month.

However, prices have been moving upward for the past three weeks, and now stand slightly above $600 per thousand board feet.

Elevated lumber prices since mid-April have added thousands of dollars to the cost of new single-family homes and apartment units.

Indications are that lumber producers are reducing production heading into the slower winter building season, even as new residential construction continues to outpace seasonal norms.

However, there is some good news on the lumber front regarding tariffs on Canadian softwood lumber.

The U.S. Commerce Department’s International Trade Administration published an administrative review of anti-dumping duties in late November, followed by an administrative review of countervailing duties on Dec. 1.

The effect of the reviews is that duties on shipments of Canadian lumber into the United States, which currently stand at 20%, will be reduced by more than half, to roughly 9%. The tariff reductions are expected to go into effect in mid-December.

“This is a step in the right direction, as tariffs have contributed to unprecedented price volatility in the lumber market, leading to higher prices and harming housing affordability for American families,” said NAHB Chairman Chuck Fowke. “The United States needs to work with Canadian officials to end the tariffs and achieve a long-term, stable solution in lumber trade that provides for a consistent and fairly priced lumber supply.”</blockquote>

Deemed "non-essential" = closed = less production, affecting supply of (less elastic, or slow to respond) demand. On top of the already in place tariff situation

So the comments about being paid extra not to work is just mouthing. As I thought.

Every working trade makes way more than they would get on unemployment. Even the helpers make more. The only people willing to sit home are those making substantially less. Like retail, clerical, low level manufacturing, agricultural, and food service,. All considered “essential” categories that have never been paid as though they are essential.

To the OP: You’ve already seen the price go up because you didn’t move on this 3 months ago. Unfortunately, your hope that things will be better if you wait until spring is not a likely occurrence. I predict you’ll be posting a few months from now about your dismay that prices have increased again, and wondering if they will go down in summer....

Did everyone miss the part where everyone got unemployment all year, plus $600/week... Alright

Everyone? Yeah I missed that part.

sprink1es-

Huh?

No $600 extra in many areas of the country. That is just one of those Urban Legends that everyone received it. Not everyone who applied for it was eligible. In this state you need to have " Your total base period wages must be at least 1.5 times your highest quarter wages or you must make at least $19,500 during two of the four base period quarters." to qualify for unemployment. Not qualified for unemployment none of the mythical $600. Many of the unemployed never made that much money in any quarter. People need to check their own states qualifications to receive unemployment. Some of the qualifications were waved for gig workers in some states.

Building is risky. Prices are rarely fixed. When we built our lumber costs went up by 40%. It was a shock to the system to say the least but that’s what happens. People who build need to have a good contingency fund for just this kind of thing. If at the start of the build you are over, you aren’t actually over, that’s just the current cost to build.

Our builder now wants an escalation clause in the contract or to raise the price another $25K, which would make an increase of $60K since March of 2020.

Glad my contract is fixed pricing, signed back in July. The same house in the same neighborhood is $25k higher now.

It continues to be ugly. We thought for a month or so that it was slowing down, but now it's up like crazy every day. Also, we are seeing increases from manufacturers starting to roll in. USG put out a letter last week that stated 20% increase coming on sheet goods, 5% on mud, and 10% on corners ect. Steel going up, windows, cabinets........

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I have a feeling there will be horror stories regarding projects that have run out of money. Many of my customers are limited by budget. Not that they don't want to spend it, but they can't go over budget by large amounts.

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To wait or not to wait? If you asked me in August I was telling people to wait. I was wrong! No end in site. If you do proceed, plan to buy product well in advance of when needed. I am currently pricing 3200sf home to be built this spring. He is going to pay for and take delivery on all the framing (except trusses), sheathing, windows, doors, and flooring now. He is fortunate to have a place to store these for the next 3 months.

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Crazy times folks!!

I think it's safe to say things are too expensive now...and will be even more expensive tomorrow. The supply chain disruptions, the pent-up demand for limited resources, and the competition for people capable of doing competent work will only increase. The lives of many people have been permanently changed by the pandemic, and working from home will be an increasing feature of our society. That will mean more people will want to improve their existing living spaces and better accommodate them to this new reality. If you think things will normalize any time soon so that prices will somehow magically come down, you will continue to be disappointed. If I were wanting to build right now, I'd get in line as quickly as possible, grit my teeth, and accept that I might have to build something less ambitious in order to build at all. I'm still waiting to hear someone relate their own personal experience about saving a lot of money by putting off building. I'm sure it has happened, just like some people can occasionally time the stock market correctly, but I don't think that situation is what is facing us at the moment.

We are currently working with an architect on our plans. The plan is to take this next year to make every single choice for the house, along with a huge spreadsheet of the budget. Also, to find contractors for the build. We are looking at a 2021 start date. We have decided on ICF, lumber costs helped us close in on that decision. What is the outlook for a year from now? Are we still screwed? LOL. 😩

To @kudzu9 's point things are definitely changing for the long run. I am in a very rural region, we have multiple youngish families moving "back home" to get away from the large and congested urban areas they been living in. Working from home can be anywhere there is a good internet connection. Someone told me San Francisco has a ton more properties available than normal. Here, we are in a HUGE seller's market. I would think that if you are in a large market that is seeing some exodus the next few months might be a great time to find a new home, not build.

Unless the virus is more contained than I think it will be people because of loss of jobs and/or a return to single income families may cause a glut of existing houses. Finding a good internet connection in some rural areas is interesting. While nothing to do with building people who do have a steady income may like after the 2008 bust be able to purchase nice existing properties much cheaper than they currently can. I hope I am wrong but seeing all of the people rushing to purchase new homes right now worries me.

I’m sure there are regional variations. But I can tell you that, in the major metropolitan area where I live, the competition for homes is fierce. Just yesterday I was taliking to a friend who had just bought a house by bidding substantially above asking after being outbid on 5 other houses in the last two months.

We live in a suburb and housing inventory was very low even before Covid. Home prices have continued to rise quickly too. The chance of us finding a suitable existing home (we need a 5 bedroom) in our town are slim, as we looked for two years before deciding to build. On a positive note, we live in a nice house that will sell quickly and for a good amount of money.

We're in a very similar situation. We'd like to move to the next county over where it's farther away from the major metro and more rural. But in the past handful of months, the market has tightened, prices have gone up and bidding wars are ridiculous.

Houses can have over a dozen. showings in one day- 14 for one recently.

We looked at a home and our realtor was urging us to look inside first, before we went to look at the grounds and back yard. We had a 15 minute time slot!

I need more time in a car, let alone a house, to buy something so important!

I wanted to add, that we've seen new home base prices increase 6 figures because of demand, not just cost.