Lumber Prices coming down
Lumber Prices Crash 30% as Mortgage Rates Start Going Up
Vance Cariaga
Thu, February 3, 2022, 7:06 AM EST
bitterfly / Getty Images/iStockphoto
The prospect of a cooling housing market tied to higher mortgage rates and ongoing supply-chain issues has sent the price of lumber tumbling from the lofty heights it hit last month.
Lumber prices have fallen 30% over the past two weeks, Business Insider reported, hitting a low of $934 per thousand board feet on Tuesday. That was down from $1,338 as recently as Jan. 14. The recent slump is the lumber industry’s longest since July, Bloomberg reported.
Part of the decline has been attributed to rising mortgage rates, which some industry experts say will lead to a slowdown in home sales. The average 30-year fixed mortgage rate increased 50 basis points to 3.55% between late December 2021 and late January, according to Freddie Mac. And as GOBankingRates recently reported, the Mortgage Bankers Association projects that the rate will climb to 4% by the end of 2022.
The effects have already been felt on home sales. U.S. pending home sales in December declined 3.8% from the previous month and 6.9% from a year earlier, the National Association of Realtors reported last week.
“The market will likely endure a minor reduction in sales as mortgage rates continue to edge higher,” NAR Chief Economist Lawrence Yun said in a news release.
That slowdown might not last too long, however. Demand for homes remains high in the United States, and the supply of available homes remains low. Freddie Mac estimates that the market is still 3.8 million homes short of meeting current buyer demand.
Meanwhile, the drop in lumber prices continues a pattern of volatility that began during the early days of the COVID-19 pandemic. Prices reached all-time highs during the pandemic’s building boom, Bloomberg reported, but then crashed hard when sawmills accelerated production and high prices led to a drop in sales.
Complicating matters for the lumber industry are supply chain problems that keep getting worse. Flooding in British Columbia, a major lumber producer, disrupted supplies and shipments in late 2021, Bloomberg noted.
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It ain't gonna get any better anytime soon imho...
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If building materials come down I may go ahead and build houses here on my lots.
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That's good news. I have a project coming up this spring that will require much wood. 😀
Joe
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Good news that I hope lasts into the Spring. Time to build a small porch on the front of my house.
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Has to better than the 10.00 each for a 2x4x8 I was seeing last fall for crappy wood even
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I've been holding off redoing the deck (24' x24' ). It almost needs a total rebuild.
We have a carport underneath, and have been rethinking how we might rework it to make it water tight.
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hoosier: 30500022875547/comments/30500014816923
I've been holding off redoing the deck (24' x24' ). It almost needs a total rebuild.
We have a carport underneath, and have been rethinking how we might rework it to make it water tight.
You might consider a low pitched metal roof under the deck. Putting a flat roof on the deck area requires quite a bit.
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Maybe shed prices will eventually come down. What was $3700 2 years ago is now $7200. I don't need one that bad. If nothing else, I'll build another myself.
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Higher interest rates... less homes being built
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"Lumber Prices Crash 30%".......AFTER Joe drove them up 400%. You left out the most important part.
Kinda like saying gas prices "crashed" 30% but gas is STILL $2.75 a gallon.(or course it hasn't crashed yet and is well over $3).
Smoke and mirrors......smoke and mirrors!
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Up 7% here according to a friend in the business.
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Yep, 3/4 plywood went to over 100.00 a sheet, was 29.00 pre Brandon.
Now about 40.00 or so. On an average don't look for it to drop for a while, if ever. Mortgage or not.
Other building supplies have skyrocketed and and with oil soon to be over 100.00 a barrel it will only go higher.
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Prices not coming down here in Florida ............................. at all!
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No way it will come down, just drive up and down the coast and resort get away areas, you will see 'Lumber yards" stacked right in the middle of the devlopements.
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When lumber prices return to somewhat 'normal' I'll order a new pole barn.
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Not paying squat for logs! Probably backed up due to hilgh prices?
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Logger told me prices were sky high for good quality oak logs. Wanted to know when he could start cutting. Said he'd bid higher for oak than for walnut.
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