With all of the recent disasters we knew it was only a matter of time for building material prices to increase.
I’ve been getting notifications from various resources, including my main lumber supplier, that some products have already increased as much as 18% and many will continue to go up.
The sudden demand for products has manufacturers struggling to keep up.
I’m starting to wonder if stock piling some commonly used materials might be a wise choice.
I was surprised to be getting calls so soon from victims of the Sonoma fires. The wheels are already turning to get those homes,(5,500 from California wildfires at last count), back on the grid. There were 8,400 total structures lost.
Unfortunately not only do the victims have to deal with rising material prices, but the labor shortage has driven labor up significantly as well. The already dire housing shortage in the Bay area has been compounded by the fires with more people without places to live struggle to find “not so affordable” housing.
On the up side there will be more than enough jobs available in the construction industry for those who aren’t afraid of hard work.
Our hearts go out to all of the victims of disasters in Houston, Miami, Puerto Rico, and California. We hope you are able to recover soon.
Click here to see some of the devastating affects of the fires.
With recent news that the nation’s home values may very well continue to drop over the next several months, it’s no wonder most homeowners have concluded that they may as well get comfortable where they’re at least for the time being.
On the positive side, at least for some production home builders, some areas have actually seen prices increase on new homes. Existing homes however may continue to see a decline in value due to the continuing market deluge of foreclosures with no foreseeable end in sight.
“We should expect house prices to continue to fall, with nationwide prices dropping another 15 to 20 percent to complete the process of deflating the bubble,” wrote Dean Baker, co-director of the Center for Economic and Policy Research, in the New York Times.
“It’s pretty clear the housing market has already double dipped,” says David Blitzer of S&P.
Patrick Newport of IHS Global Insight observed that existing home prices in several metro markets had actually triple dipped during the recession.
It has to make you wonder why the policy makers didn’t shift their focus early on to making housing more affordable during the housing bubble rather than allow prices to inflate beyond the average home buyers means and the turn a blind eye to lenders who offer mortgages that were virtually unpayable to many buyers.
The benefits of making housing more affordable to the average buyer would have an enormous impact on our economy. Not burying homebuyers in debt beyond their means frees up much needed cash that could benefit the economy by being spent in various other sectors.
There’s no doubt that when the dust settles and the reality hits that “you might as well make the best of where you’re at for now”, that at least the remodeling industry is due to see an upswing.