Lumber, building material costs soaring, raising construction prices

Worker Juan Tamez loads lumber at Matt's Cash and Carry on Thursday, May 13, 2021, in Pharr. (Joel Martinez | [email protected])

McALLEN — Builders in the area are frustrated with historically high prices for lumber and other building materials forcing up construction costs.

That was the topic of discussion when the Rio Grande Valley Builders Association met Wednesday at the Radisson Hotel McAllen Airport for their regular monthly meeting.

Lunber is loaded on the back of a truck at Matt’s Cash and Carry on Thursday, May 13, 2021, in Pharr. (Joel Martinez | [email protected])

“Today we have our representatives from our National Association of Home Builders and the Texas Association of Builders in Austin and of course Washington,” Marcy Alamia, executive vice president of the RGVBA said prior to the meeting. “They’re going to be speaking to our members about their concerns in the rise of the lumber prices — which has every builder concerned right now — as well as supplies and materials not getting received on time and putting them back a lot.”

The meeting featured a virtual discussion with state and national representatives who shared their thoughts about the antecedent to the rising lumber prices.

According to Alex Strong, a lumber and building materials lobbyist for the National Association of Home Builders, the price of lumber has nearly quadrupled from April 2020 to March 2021. He cited a Random Lengths Lumber report which stated that the price of lumber hit a new all-time high of $1,440 per thousand-board-foot.

“That is so far excessive than we have ever seen, going back to the previous all-time record high in 2018 which was $582 per thousand-board-foot,” Strong said. “We’ve seen the price — at this point — more than quadruple since April of last year.”

The discussion also featured Scott Norman, executive director of the Texas Association of Builders, Lake Coulson, NAHB vice president, and J.D. Hale, TAB director of government affairs.

Together, the speakers theorized a number of factors that could’ve led to the soaring prices of lumber and building materials, most stemming from the COVID-19 pandemic.

Lumber is stacked at Matt’s Cash and Carry on Thursday, May 13, 2021, in Pharr. (Joel Martinez | [email protected])

One such factor is the closing of mills due to safety precautions taken at the beginning of the pandemic, which has created a backlog of lumber. They said that production is behind by 2 billion-board-feet.

Other factors brought up pertaining to the pandemic include production being limited due to predictions that the economy would collapse.

“When they realized that there was no slowing down our industry — that we were on the various lifts that allowed us to continue to work in most states and the federal level — when they realized that coupled with unprecedented DIY demand, they scrambled to try to catch up,” Strong said. “Then they ran into a wall of safe-work practices and outbreaks in factories and things of that nature coupled with trucking shortages coupled with labor issues attached to insurance benefits — I think the issues have made it impossible, at least initially, for them to run at 100% capacity.”

Another factor that the speakers attributed the prices to was the winter storm in February, which resulted in large-scale power outages.

“It truly is a perfect storm,” Hale added. “That is the perfect description for all of this.”

Efrain Gomez, who is president of Gomez 3 Construction and one of the directors of RGVBA, said that the high price of lumber and supplies has put a strain on the way homes are priced.

“It’s just been really difficult, especially on the clients’ side,” Gomez said. “At the end of the day they’re the ones purchasing the homes. For the most part, they’re the ones taking the biggest hit. As a builder, we have to absorb some of that cost. We have to obviously absorb the stress of the whole situation.”

“We try to reduce that stress as much as possible, but at the end of the day we have to relay the bad news to these clients,” Gomez continued. “Unfortunately, for some of them, it just prices them out of their budget. It’s out of my hands. Really, I’m just the voice of bad news. It’s really out of our hands.”

Lumber is stacked at Matt’s Cash and Carry on Thursday, May 13, 2021, in Pharr. (Joel Martinez | [email protected])