What’s Behind the High Price of Wood? Lumber Costs Soar During the Pandemic
If you were planning to have renovations or construction done this summer, you may want to rethink your budget. The COVID-19 pandemic has disrupted supply chains all around the continent and sparked an inexplicably red hot housing market throughout Canada, causing the price of lumber to skyrocket in recent months. Coupled with a very low lumber supply, and you have a recipe for paying far more than you were planning for that new deck or shed.
Experts are currently recommending that anybody planning new construction projects (especially for new homes) should add more to their budget due to the price of lumber. So what exactly is behind the high price (and low supply) of wood, and will this disappear anytime soon? Here’s everything you need to know.
The cost of lumber and building materials has more than doubled
The pandemic has affected just about every industry in the country in some way, with constant lockdowns and increasingly harsh restrictions derailing supply chains everywhere. This has led to supply shortages in many sectors, with low supply being met by record high customer demand. One of the most affected materials is lumber, which has seen a massive price increase over the last year. With homeowners spending more time at home than ever before, the demand for lumber has skyrocketed at a time where supply can’t possibly keep up.
In fact, the price of lumber has nearly tripled since April 2019. The price increase is largely driven by a massive decrease in supply caused by the pandemic, which saw lumber mills ceasing production or dramatically scaling down their operations back in March 2020. Some mills were even forced to close permanently due to the pandemic’s effects on the economy.
Even with mills now back in action, the effects of the production slowdown are still being felt, and will continue to be felt for some time. Prior to COVID-19’s emergence in Canada, builders were paying an average of about $550 for a thousand board feet of lumber. Today, they’re paying nearly three times that much for the same amount of wood. The surge in new home constructions have worsened the problem, with homebuilders willingly paying up to $30,000 more in material fees in many cases. Even smaller homebuilding projects can cost up to $10,000 more due to the soaring price of lumber.
Homeowners who had plans to replace their wood flooring, build decks, sheds or new fences before the pandemic are now being faced with a dilemma – do you pay the higher price now, or do you wait for an undetermined amount of time to go ahead with the project? Even if you choose to go ahead with the project, many contractors are having trouble even getting their hands on a sufficient supply of lumber to complete projects, further complicating the situation and forcing homeowners to choose different contractors who might have access to more lumber.
When will lumber prices go back to normal?
The reality of the situation is that nobody knows when prices will return to “normal” or how that might happen. The supply chain interruptions coupled with record high demand we’re seeing have created a huge market disruption that could take some time to overcome. It’s likely that the best cure for high lumber prices is simply going to have to be time – once demand returns to normal and supply chains have time to catch up, it’s likely that the market will correct itself and that prices will fall closer to what was once considered normal. However, this may take as little as six months to as long as two years.
Until new home construction and high consumer demand return to their pre-pandemic levels, these high prices are here to stay for a little while. With vaccinations, the pandemic will wind down significantly as 2021 progresses, meaning consumer habits are very likely to return to normal once people are able to travel and return to their pre-pandemic lives. Lucky for us (and you!), the price of windows and doors has only been marginally affected, so any window or door project you hire us for won’t have these additional costs built in.
Looking to kickstart your renovations with gorgeous new windows and doors? Muskoka Window and Door Centre is the premier provider of quality windows and doors for homes and cottages. Our showroom is home to the absolute best the industry has to offer, curated to reflect the tastes and needs of Muskoka cottage and homeowners. To get started on your upcoming door or window installation project, get in touch with us today.