LBM MARKET FINISHES YEAR IN THE MOST 2020 KIND OF WAYDecember 28, 2020
Q: We’re considering a major remodel to our home this summer, but we’ve seen several news reports cautioning that the cost and availability of building materials are really unpredictable right now, which has us concerned. What do we need to know in order to best prepare and plan for navigating this project?
A: What you’re hearing in the news is true; The industry is facing the most dynamic market conditions its ever seen, presenting challenges for homeowners, contractors, and suppliers like GR Mitchell. Calculated planning by all parties involved, including preparing for contingencies, are going to be what it takes to execute a smooth home remodel.
What’s Going On In The Market
We’re all tired of hearing ‘the pandemic’ as justification for negative news, but it’s certainly driven many of the challenges that exist in the current market.
Scarcity of lumber has been an issue in flux since the summer of 2020, while lead times for finished goods (think windows and cabinetry) have gone from weeks to months in some cases. Manufacturing capabilities have been hindered by sporadic shutdowns, evolving COVID protocols, and other labor issues. Sourcing of componentry presented further delays and imported products saw transportation back-ups at the port and on railways.
Heightened demand has added to the strain on an already belabored supply chain. Afterall, you’re not alone in wanting to undergo a remodel! Many homeowners retained their income over the past year while cutting discretionary spending, so they’re ready to make financial investments in their home (not to mention that more time spent at home made deficiencies more apparent). In addition to remodels, a great number of families are on the move, even as the inventory of homes teeters on non-existent. The result: a building boom. With remodels and new construction both at high levels, demand is up!
Scarce product inventory + heightened demand = climbing product cost. For example, lumber is up roughly 2.5 times what it was this time last year. Plus, annual price increases on goods like drywall, decking, hardware, etc are typically 2-5%, but this year we’ve seen 10, 15 or even 20%.
So, How Should You Proceed With Your Upcoming Project?
Be willing to make substitutions: Both in regard to price and lead time/availability, you might find yourself in a situation where being prepared to substitute a ‘like-item’ will work out well in your favor. Talk to your contractor about swapping products based on current market conditions; this could even include products in the framing step that will not impact design.
Get your contractor lined up early: High demand doesn’t only impact materials, but labor availability. Many builders/remodelers have a backlog of business, so if you have a deadline in mind, it’s best to commit to a professional sooner than later. Early commitments might also help with permitting, a process which has also seen some delays because of demand and COVID disruptions.
Don’t delay your project: You likely won’t benefit from ‘riding this out’. We’ve seen some lulls in price increases over the past year, but it’s clear that you shouldn’t expect prices to drop any time soon. Think about the old adage “…1 in the hand is worth 2 in the bush,” if the materials your project ne
Need a little more help with picking materials for your remodel? No problem. Don’t hesitate to call GR Mitchell with questions or visit our showroom for a more hands-on approach.
Like building materials, major appliances are suffering from supply chain delays. If your remodel includes your kitchen or laundry room, consider purchasing appliances as soon as your design is locked in.