NAHB says Pres. Biden is uneasy about the rising cost of lumber and homebuyer problems. Builders proposed a summit that includes the lumber industry and Dept. of Commerce.
WASHINGTON – After a meeting with Department of Commerce Secretary Gina Raimondo, the National Association of Home Builders’ (NAHB) senior officer team, Raimondo acknowledged the depth of the lumber price crisis and its effects on the residential construction industry, home buyers and renters.
According to NAHB, CEO Jerry Howard and Raimondo discussed working together on convening a summit that would include representatives from the U.S. government, the lumber supply chain and the home building industry.
“Commerce Secretary Raimondo understands that high lumber costs are adding tens of thousands of dollars to the price of a new home,” says NAHB Chairman Chuck Fowke, a custom home builder from Tampa. “She heard our stories and acknowledged that she is concerned – and that President Biden is concerned – about the effect of the lumber price problem on the broader economy.”
“There is a disconnect between lumber supply and housing demand,” says NAHB First Vice Chairman Jerry Konter, a home builder from Savannah, Ga. “U.S. sawmill output increased 3.3% in 2020. But over the same period, single-family construction increased 12% to almost 1 million housing starts, and the remodeling market expanded 7%. We feel this mismatch between domestic production and rising demand for building materials is at the root of the unsustainable increases in lumber prices.”
Current prices according to the Random Lengths Framing Lumber Composite Index – the industry benchmark – have more than quadrupled since April 2020, and are now more than $1,500 per thousand board feet. Lumber prices alone add nearly $36,000 to the price of a new home, according to an analysis released by NAHB.
As recently as the mid-1990s, roughly 10 billion board feet of lumber was harvested from the nation’s forests each year. Over the last 10 years, the harvest has fallen below 3 billion board feet most years.
NAHB’s Alicia Huey asked Raimondo to advocate for better, more active forest management goals from U.S. national forests to help ease the current shortage, and NAHB’s Carl Harris encouraged the secretary to push for a lasting softwood lumber agreement with Canada.
“We need trade policy that actually serves the interests of the American people and increases housing opportunity for first-generation home buyers,” Harris says.
According to NAHB, Raimondo considered the proposals tangible ideas, including the ones for better forest management, increased production from the nation’s sawmills and working toward a more lasting agreement with Canada.
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