Building Material Costs Increase Upwards of 200% in One Year
Building a home in the U.S. has never been more expensive than it is today, says Bloomberg. Building material costs have increased upwards of 260% since a year ago, resulting in difficult conversations with buyers and builders unable to meet sky high demand. One Idaho builder is spending $40,000 to $100,000 more during construction, mainly due to rising lumber costs. On average, the price of foundation and concrete slabs have advanced 104% this year, trusses cost 146% more, and lumber is up 262%. Read more to see a full breakdown of specific material cost increases.
In Boise, Idaho, one of the hottest housing markets in the country, Steve Martinez opened up the financial books of his construction company, Tradewinds General Contracting Inc., to Bloomberg News to reveal the magnitude of the cost surge. He’s had to raise prices on some of the houses the company makes—which include the Baybrook, a single-floor, 3,031-square-foot model—to offset the higher costs, leading to many “tough conversations” with clients.
With raw materials prices continuing to surge around the world, the pressure on builders to increase costs is likely to grow stronger.
“This could be industry killing if things continue going the way they’re going,” said Martinez, who has had to tack on price increases during construction of anywhere from $40,000 to $100,000, primarily due to rising lumber costs. “We’re putting projects off. We’ve got clients that are hitting their price ceiling.”