Robert Dietz, chief economist at the NAHB, said he's heard from builders that 'œthere are ongoing challenges, and in some cases growing challenges, with flooring, other kinds of building materials.' Before 2020, it was typical for such aggregate prices to rise a little over 1% annually. Still, wholesale prices for a category of homebuilding components that includes windows, roofing tiles, doors and steel, increased 22% over the last 12 months, according to an analysis of Labor Department data conducted by the National Association of Home Builders. They've since dropped to $634, about 10% higher than a year ago. Lumber futures jumped to an all-time high $1,670 per thousand board feet in May. Factories went idle temporarily and are now trying to catch up on production at the same time that demand has intensified due to an unexpectedly hot housing market and a surge in home remodeling.

The pandemic set the stage for higher prices and shortages of construction products. 'œI've been doing this since 1986 and I have to say I've never seen anything like this before.' 'œNowadays, we literally could be sitting waiting 30 days, maybe even 60, for one thing or another,' said CEO Mike Sivage. The erosion in affordability is one reason the pace of home sales has been easing in recent months.Īt Sivage Homes in Albuquerque, N.M., the builder's efforts to keep its construction on schedule are undercut almost daily by delays for everything from plumbing fixtures and windows, to bathtubs and appliances. Economists worry many first-time homebuyers are getting priced out of the market. The constraints on homebuilders are unwelcome news for homebuyers, already facing historically low levels of resale homes on the market and record prices. The Federal Reserve meets this week and officials' outlook on when they might start raising interest rates could indicate how worried the Fed is about inflation. Across the economy, prices having spiked this year amid shortages of manufactured goods and components, from cars and computer chips to paint and building materials.

Rising world building