Lumber Prices Are Tanking As Housing Prices Are Skyrocketing And Honestly, I Just Want A Bigger House

Remember last year when the price of lumber was through the roof? We were all worried that the price of toilet paper was going to skyrocket because of it.

We are in the exact opposite situation now. I mean, toilet paper isn’t involved, but the price of lumber is spiraling out of control.

Inflation is no freaking joke right now. People can’t afford to buy the gas it takes to get to work, let alone buy their forever home.

In fact, according to Insider, there has “never been a worse time to buy a home” than right now.

They are serious. We were just starting the process of looking for, and buying a home when everything on the housing front went haywire.

Why Are Lumber Prices On The Decline?

With everything else skyrocketing in the price department, it seems weird that the price of lumber has had such a steep turnaround.

Last year, lumber prices were up over $1,700 as people were coming out of the pandemic frenzy. They were ready to start doing things like improve on their homes. That takes lumber.

Supply and demand, my friends.

Now, because we are on the express elevator to inflation town, people can’t afford to fix up their houses, let alone buy anything new.

Lumber prices have been on a steep decline as a combination of rising interest rates, record-high inflation and a red-hot housing market translate into fewer people being able to afford to buy their own home. 

Insider

This has caused the price of lumber to metaphorically fall off the edge of a cliff. Prices went from more than $1,700 twelve months ago to a record low $600 just this week.

Are Things Going To Improve Anytime Soon?

Well, the outlook is not good.

Gas has gone up, home prices have skyrocketed out of control, food prices are up. It doesn’t look like people are going to go out and drop money on luxuries like houses anytime soon.

I’m going to be stuck renting my tiny duplex forever. Ugh.

The combination of higher home prices, rising construction costs and moderately higher interest rates will exacerbate housing affordability conditions and increasingly push prospective buyers out of the market in the coming months.

Robert Dietz, National Association of Homebuilders chief economist

Bottom line? Buckle up, my friends. We are in for a bumpy road ahead.