Members of Congress Urge Federal Action on High Lumber Prices
With the cost of construction materials on the rise, homebuilders look to Washington for a solution to the biggest problem plaguing their industry.
Last week, congressional representatives Jim Costa (D-Calif.) and Jodey Arrington (R-Texas) sent a letter to President Joe Biden and the Department of Justice requesting federal action to curb the rising cost of building materials, specifically record-high lumber prices.
Lumber prices have been a major concern for the construction industry since July 2020 when COVID-19 slowed sawmill production in the U.S., driving lumber above $500 per 1,000 board feet for the first time since 2018. Now, less than a year later, prices have doubled to $1000 per 1,000 board feet.
In their letter, the congressmen expressed concern that rising material costs are stunting economic recovery by limiting the U.S. housing industry when it should be growing. The lawmakers cited data from the National Association of Home Builders (NAHB) showing skyrocketing lumber costs increased the price of a new home by more than $24,000 since April 2020.
“Unfortunately, this unprecedented price increase on new homeowners, as well as home builders, will persist until new sawmills come online and current mills re-open and operate at full capacity,” Costa and Arrington wrote. “To address this issue, we ask your Administration to facilitate a discussion with all stakeholders, including sawmills, home builders, loggers, and distributors, to ensure all needs are met in a timely manner.”
Homebuilding is not the only sector of the construction industry reeling from building material price jumps. The Associated General Contractors of America (AGC) wrote an open letter to President Biden in late February detailing the impact lumber prices are having on the multifamily residential and non-residential construction industries.
“The volatility of lumber prices and the impossibility of pinning down future delivery dates is making it extremely difficult for contractors to provide bid prices or completion times for upcoming projects,” wrote AGC president Stephen Sandherr.
“AGC believes the White House can play a constructive role in mitigating this growing threat to multifamily housing and other construction sectors by urging domestic lumber producers to ramp up production to ease growing shortages and making it a priority to work with Canada on a new softwood lumber agreement.”
This is also not the first time the NAHB asked lawmakers to resolve rising homebuilding material costs. In October 2020, the NAHB worked with nearly 100 members of Congress to send a letter to former President Donald Trump. Bringing down lumber prices clearly remains a major focus for the NAHB, especially with potentially a busy spring for their industry right around the corner.
“NAHB’s top priority is to find solutions that will ensure a lasting and stable supply of lumber for the home building industry at a competitive price,” the association said in a statement. “NAHB is urging the Commerce Department to investigate why lumber production — particularly sawmill output — remains at such low levels during a period of prolonged high demand.”