What will you pay for lumber in June 2022?
Lumber prices continue to favor the buyer over the past few weeks. There has never been a better time to build a house. In addition, the housing market can breathe a sigh of relief following the British Columbia floods late last year that disrupted supplies and pushed prices to $1,733 per thousand board feet.
Lumber Price Update for June 2022
The price of lumber dropped to record levels at the start of June. According to the report from Market Insider, supply chain issues contributed to the spiraling costs. If the demand from the housing market does not pick up, lumber prices will only continue to plummet.
The drop in the prices of lumber came on the heels of the surging housing rates as the numbers for the 30-year fixed mortgage rates continue to hover above five percent. In addition, the interest rates are still very high. As a result, buying has cooled down in recent months. The National Association of Home Builders has not observed much activity on existing and new home sales.
In the same vein, the home improvement stores and sawmills also expect prices to continue to fall because of this trend. In May, for example, the cost of lumber dropped to $829 per thousand board feet.
This past week, lumber prices has dropped to a new record low for 2022 at $604 per thousand board feet.
What this Lumber Price Update Means to the Housing Market
As of the present, the price of lumber dropped 47 percent year-to-date. You are looking at a decline of 65% compared to the peak of $1,733 per board/feet last year. Hopefully, the steeped drop will help the inflationary pressure on the real estate industry. So, you should visit your favorite lumber company right now if you are thinking about building a house.
However, Fortune cautioned the housing market is still in flux. Remember that in March 2022, lumber prices rose to $1,357 per thousand board feet due to the conflict in Ukraine.
Even if you account for the recent decline, lumber prices are still up 135% since 2020. the National Association of Home Builders reminded everyone that the cost of building a single-family home remains prohibitive for a lot of Americans at $18,000 on average.
Strike While the Iron is Hot
Visit your favorite lumber yard today as the prices remain favorable to the consumer.
Unfortunately, the market is very volatile as inflation in the U.S. pushed the prices of gas and commodities to painful levels. While the lumber industry has remained immune to the soaring costs, industry experts expect prices to adjust.
For example, the record-high levels of gas prices will impact the cost of transporting the wood from the source to lumber yards. For now, suppliers absorb the charges, but it will not likely continue.
Hopefully, the declining lumber price will kickstart housing, rising to 3.9% in March 2022.
Whether you want to build a wood deck or an entire house, you should strike while the iron is hot because the declining lumber prices are only temporary. It’s good news for the housing market that the average lumber yard has slowed down on its orders and mortgage rates remain high.
The Cycle Continues
But the industry would likely correct itself when the perfect storm of factors collapses. After all, it’s not a new trend since the market undergoes a cycle each season. As the lumber prices plummet, housing starts will also rise. The sawmills will also tick up their supply to meet the demand.
This demand, coupled with the inflation that already impacted most commodities, will eventually arrest the free-fall in lumber prices.
For now, however, the lumber price update is still favorable for the housing market.
Get the Lumber You Need at Peninsular Lumber Today
If you need a one-stop-shop for lumber, you cannot go wrong with Peninsular Lumber, which has the most extensive materials available for builders. If you need lumber and lumber supplies for custom home building, DIY projects, and other summer projects, come visit our lumber company in Tampa Bay. We have everything you need to complete the projects you want to complete.