NAHB Reports Potential Peak in Cost of Building Materials

The price of building materials may start to lower, according to the NAHB
by Staff

The pandemic may have contributed to these higher prices, but it is unclear if things will return to normal any time soon.

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The pandemic may have contributed to these higher prices, but it is unclear if things will return to normal any time soon.

Over the past year, the prices for building materials, things like steel mill products that have increased 105% since January and concrete that has increased 12% from the start of 2021, have climbed almost 20% overall. According to the National Association of Home Builders (NAHB), this can be attributed to a period of high demand and low supply. But in the recent months prices for concrete have only increased 3.2% and the price for steel mill products has actually lowered by 3.1%. The NAHB is anticipating the prices for building materials to lower or stagnate from here on out. Lumber is the most obvious indication to this reasoning, as the price of lumber has decreased by 48% compared to 2021. NAHB Chief Economist Robert Dietz explains, "In short, while the Fed can cool the demand-side of the economy, reducing inflation and growth, additional output on the supply-side is required in order to tame the growth in costs that we see in housing and other sectors of the economy." The NAHB Housing Market Index reports similar findings of declining housing buyer traffic.