Building Material Prices Surging
New York, NY, March 17, 2021-Prices are surging for the raw materials used to build American homes, reports the Wall Street Journal.
“Lumber, one of the biggest costs in home-building after land and labor, has never been more expensive and is more than twice the typical price for this time of year. Crude oil, a starting point for paint, drain pipe, roof shingles and flooring, has shot up more than 80% since October. Copper, which carries water and electricity throughout houses, costs about a third more than it did in the autumn.
“Prices for granite, insulation, concrete blocks and common brick have all pushed to records in 2021, according to the Bureau of Labor Statistic’s producer-price index, which measures the change in prices that producers receive for their output. Drywall and ceramic tiles are short of records but have also climbed.
“Materials producers like paintmaker Sherwin-Williams Co. and flooring manufacturer Mohawk Industries Inc. as well as builders D.R. Horton Inc. and Hovnanian Enterprises Inc. have been raising prices to pass along higher costs. They can thank historically low borrowing costs, federal stimulus payments and a hunt for yield that has sent investors barreling into the home-rental business.
“‘Whoever the home buyers are, they have been able to pay for it,’ said Todd Tomalak, who tracks building products for John Burns Real Estate Consulting.”