Home Builders

Why is Lumber So Expensive? What to Know as Lumber Prices Soar

It's a problem being seen across the country and across Illinois - and it's having a major impact on both prospective and current homeowners

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As many building a house or remodeling an existing home now know, the cost of lumber is skyrocketing.

It's a problem being seen across the country and across Illinois - and it's having a major impact on both prospective and current homeowners.

The National Association of Home Builders reports the "unprecedented spikes in lumber prices have added nearly $36,000 to the average price of a new single-family home, and nearly $13,000 to the price of a multifamily home since April 2020."

As a result, homebuilders are adding clauses to their contracts explaining that while they are bidding jobs at today’s lumber prices, customers could pay thousands more in the future.

“Depending on the size of the house, you’re probably something between 5-7% more on the build,” homebuilder Tom Len told NBC 5 in April.

According to Lee Cohen of Standard Lumber Company in Glenview, a piece of plywood that cost around $20 last year now costs about three times that, rising to $64.

“When the pandemic was beginning, everybody thought that the housing market was gonna tank. But instead, you have all these homeowners looking at things that they want to do, the market has been up about 400% in demand,” Cohen said.

The Home Builders Association of Illinois told NBC 5 it’s unclear how long the lumber prices will stay high.

“Hopefully we can get some answers from the federal government soon as to why these numbers are going up and that a correction can be made,” said HBAI executive vice president Bill Ward.

In a post on the National Association of Home Builders website Monday, the association said the cost of lumber is made even worse as appraisals "struggle to reflect these ever-rising costs."

Still, builders said demand remains high.

“Obviously, nobody wants to pay a little more, but it’s kind of the cost of doing business in this age,” Len said.

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