Buffalo, N.Y. (WBEN) - The lumber prices during the pandemic were high and so is the demand for houses. Lumber prices are looking like what they were before the pandemic started, but will this last?
9 out of 10 of single-family homes are wood-framed according to the National Association of Home Builders, so it is critical that construction companies get the lumber they need to complete their projects.
"We've seen the neutralization lumber costs kind of slowly occurring over the last several months, to the point now where we're almost back to pre-pandemic levels. Of course, we find it difficult to trust in the pricing right now. So being able to guarantee lumber costs is something that we've learned not to do because of what COVID did to the spike of lumber," said Domenic Cortese, President of Cortese Construction Services Corporation.
Despite lumber prices leveling out, prices still remain high for other various building supplies.
"We are seeing volatility in other places still, including other building materials, roofing, siding, windows, doors, sawdust, vinyl-blended trim materials, prep brands like VERSATEX. There are tremendous increases in those price levels still. So yes, we are confident in a return to normalcy with pricing and lumber. But how long it's here to stay is certainly the question," said Cortese.
The pandemic was a difficult time for builders and construction companies because companies couldn't give accurate and proper estimates on the budget of a project, but Cortese is optimistic that moving forward, the decline in price is going to help stabilize costs.
"We had to tell our customers that we weren't able to fix any of their lumber costs and we would do an accounting and an auditing post project. In our level with home renovations it did affect a lot of job budgets. In bigger settings where homebuilders are buying perhaps larger volumes, we've seen they've been able to stockpile and buy larger inventories to help control the rise and fall and kind of, neutralize their costs a little bit more effectively. So I would say it's a positive move and it's going to help for forecasting more than anything as well as also protecting customers from any future surges and cost," said Cortese.
Lumber prices are important for the operation of construction, but so is staff. Construction companies are no exception to the constant labor shortage problem plaguing our post-pandemic world.
"We're suffering through a lot of things in our industry that relate to costs, but the biggest thing that we're suffering through is a labor shortage and that continues to be a problem. In spite of any neutralization of lumber material costs, we're still short handed and I think what you may be seeing mpre in new home construction, as is with us in home renovation, is the inability to perform based on the lack of staff, and not the materials," Cortese said.
Cortese adds that production at the lumber facilities is still not where it was before the pandemic but labor shortages as well as shipping issues present a serious issue for construction businesses.
Lower costs for lumber is a step in the right direction, but as with most companies coming out of the pandemic, there continue to be problems hindering performance.
"It takes great patience from a consumer to be able to weather through what builders are dealing with. From the builder side, it's challenging for us because nobody wants to promise something they can't deliver on and it seems that this is happening around every corner, were either we're faced with the availability of some materials and then the volatility of cost for others, and the continuing problem of labor. It's a tough time to be in the building business," Cortese said.