Downward Trend in Lumber Prices Boosts PHC Demand
Housing demand is so strong right now that the gap between closed sales and new home starts is at an unprecedented level. As home builders strive to meet this increase in construction, plumbing and HVAC professionals are certain to be in demand.
Framing lumber prices peaked at an all-time high in mid-September, and have been trending downward ever since.
Lumber prices rose approximately 120% between April and September to a dramatic high. Builders report that the price spike added approximately $16,000 to the price of a typical new home. But in the last month alone, from mid-September until now, these prices have retreated a full 20%.
The price drop of lumber comes on the heels of the National Association of Home Builders lobbying the White House to urge domestic lumber producers to increase production levels to ease the shortages and to end the 20% tariff on Canadian lumber coming into the US. Domestic supply chain shortages were attributed to the Covid-19 pandemic.
Meanwhile, US new home sales outpace new home starts by a healthy margin.
Housing demand is so strong right now that the gap between closed sales and new home starts is at an unprecedented level. Nationally, there was a nearly 5% increase in sales of single family new homes in August of this year alone. The acceleration of housing demand is at the highest pace since Sept 2006. Additionally, presales of as-yet unbuilt homes was nearly 70% higher this August than last.
Historically low interest rates are contributing to this on-going surge, but also at play is a consumer taste that is shifting toward lower density markets. This high demand is met with a historically low inventory of available homes. Nationally, inventory of new single family homes has fallen to just over a three month supply. These are the lowest numbers our country has seen since 1963.
As home builders strive to meet this increase in construction, plumbing and HVAC professionals are certain to be in demand.