Lumber costs have been spiking over the past year. That can have a significant effect on the cost of your next remodel. So why are lumber prices so high, and what can you do to offset some of those costs if you’re considering a home renovation project?
How much have lumber prices gone up and why?
Lumber prices have gone up more than 200% from March 2020 to March 2021. That’s true for basic two-by-fours, plywood, and other lumber materials. So, what’s behind the massive increase?
Covid-19 has a lot to do with it. As the virus hit and spread through the United States and Canada, lumber mills decreased production. Ongoing Covid restrictions have prevented many of those mills from re-opening to the levels they were running at prior to the virus. They had to operate with fewer workers on fewer shifts, which has decreased output.
But Covid isn’t the only reason for the higher lumber prices, especially here in the Pacific Northwest and in California. Last summer our region experienced several major wildfires. Some of them consumed stock already at mills or burned mills themselves. That affected the ability of some mills to simply produce lumber.
How do the higher lumber prices affect my remodel?
The short answer is it depends on the type of remodel you’re doing. For example, bathroom remodels typically use very little lumber, so higher lumber prices should have a minimal effect on your project.
Similarly, kitchen remodels should not be affected very much either. Though, you may see higher costs in certain lumber-heavy items like cabinets.
You’re going to see the most dramatic cost increases in projects that use a lot of lumber, like additions where you’re building out and expanding your home, or in cases where you’re adding a second story.
In general, we’ve found that lumber alone makes up about 17% of those kinds of projects. Given that lumber prices have doubled in the last year, a $100,000 addition last year would cost you about $117,000 now.
What can I do to offset some of those costs?
You have at least a couple of options that can help decrease some of the higher lumber costs in your remodel.
1. Advanced framing techniques
The first is to ask your contractor if they’re using what are called “advanced framing techniques.” Essentially, this involves framing the walls in a way that uses fewer boards and studs and more insulation. This allows for less lumber overall to be needed and it makes the space more energy efficient.
Lamont Bros. and a lot of other firms in the area already use these techniques, but if your contractor isn’t, you could save about 10% on your project if they did.
2. Focus on kitchen or bath remodels for now
Another way to help lighten your lumber costs is to prioritize less lumber-heavy remodels such as kitchens and bathrooms. This is especially true if you’re planning a whole home remodel or extensive remodeling with an addition.
What is the outlook for lumber prices?
Lumber prices appear to have peaked for now and indications are that they may begin to go down over the next year, so putting off things like additions for a few months and focusing instead on a master bathroom remodel could save you in the long run.
They may not go as low as they were last year, but the good news is that we don’t expect to see any surprise lumber price hikes going forward.
Are you planning a home remodel and aren’t sure where to start? We’re happy to discuss your project. Simply schedule a conversation with us!