2022 Lumber Costs and Prices for Building a House
The cost of lumber has gone through a roller coaster in the past two years for many reasons—from the increased demand for homes to the lumber shortage due to supply chain issues and the British Columbia floods. Given the massive price increases in the lumber industry, building costs have also risen significantly.
So, if you have been thinking of building a house, make sure to review the cost of lumber and other essential factors before jumping into construction. Of course, lumber is just one of many expenses to consider in the process, but the volatility in its price has affected building costs significantly.
Here is some information to help you estimate your project budget.
So far, things are looking good as lumber prices have dropped by 23% as of April 2022, falling below the $1,000 mark to about $882 per thousand board feet in mid-April. The drop can be attributed to easing demand caused by higher mortgage rates, rising inflation, and a slowdown in home renovations.
Of course, this is good news for anyone who plans to build a house. However, despite the drop in prices, it is worth noting that the cost of lumber remains much higher than it was at the start of the pandemic. The National Association of Home Builders stated that volatile lumber prices have caused the average cost of a single-family home to increase by over $18,600 in the past year or so.
Likewise, homebuilders have been swamped with work since the start of the year. In March, the backlog of homes approved for construction but not yet started grew by 2.9%, reaching 280,000 units. Additionally, about 811,000 single-family homes were under construction, showing how much builders have in their pipeline.
It is also essential to consider your timeline and have realistic expectations about how long it might take to finish your home. Aside from the backlog in construction, delays may also occur due to supply chain disruptions that affect all aspects of the home building process.
Other Costs of Building a Custom House
Aside from lumber, there are also other costs to consider in building a house. You can expect the prices to be higher in 2022 than in the pre-pandemic years due to the labor and supply shortages. Generally, you can split home building costs into three main components: materials, labor, and administrative items, including design and specific features.
To estimate how much you might spend, constructing a new home costs an average of $100 to $200 per square foot, but this can go up to $500 or more for luxury homes. Overall, Home Advisor estimates the cost of building a house to be around $114,209 to $450,824, with the national average being $282,299.
To break it down more specifically, here are the main costs involved in new construction:
- Land and Site Preparation
- Building Permits and Regulations
- Contractors and Laborers
- Design and Floor Plan
- Exterior Finishes
- Major Systems
- Interior Finishes
It can be hard to determine how much each component will cost, so the best way to plan your budget will be to discuss it with a home builder. Given that they are more familiar with the current cost of lumber and the overall real estate market, they can help you consider these.
Source High-Quality Lumber for Your Homebuilding Project
Given the volatile cost of lumber since the start of the pandemic, it is more important than ever to plan if you are interested in building a house. With lumber being an essential building material for almost all homes, you can expect its current price to affect how much you spend on new construction.
Whatever the case is, Peninsular Lumber is here to help you with all your lumber needs. As a top lumber company in Tampa, we offer an extensive range of hardwood and softwood lumber to turn your dream home into a reality. So call us today at 813-875-8805 to get started.