The Real Estate Market & Cost Of Lumber After The Pandemic

The real estate market and prices for wood materials is outlandish right now.

I’m still engaged in house hunting. But feeling discouraged. The prices are outrageous. People are in bidding wars to pay thousands of dollars over the asking price when home prices are too high to begin with.

I’m not savvy about the machinations of real estate. My daughter is much better at this than I am. But she too is perplexed and a bit afraid due to her house flipping business currently costing her so much more.

The Staggering Price Of Lumber These Days:

Kendra bought what seemed like a paltry amount of wood for her flip house last week and paid $1800 for it.

Here is what $1800 of wood looks like today.

A Perfect Storm Of Factors:

Here’s what was written in Fortune magazine just over a week ago with this title:

Southern Loggers Are Pushing Wood Production To A 13-Year High. So Why Is The Price Of Lumber Up 288%?

In April, the U.S. industrial wood production index hit 134.2, its highest level since the 135.3 struck in December 2007. This was the first month of the Great Recession, after which home-building and lumber production screeched to a halt.

Earlier in June the cash price per thousand board feet of lumber was at $1,391, according to industry trade publication Random Lengths. While that’s down a bit from its $1,515 all-time high set on May 28, it’s up a staggering 288% since April 2020.

Prior to the pandemic, the price usually floated between $350 and $500.

As Fortune previously explained, this historic lumber shortage was spurred by a perfect storm of factors set off during the pandemic.

When COVID-19 broke out in spring 2020, sawmills cut production and unloaded inventory in fears of a looming housing crash.

A Predicted Crash That Didn’t Happen:

The crash didn’t happen. Instead, the opposite occurred. Americans rushed to Home Depot and Lowe’s to buy up materials for do-it-yourself projects, while recession-induced interest rates helped spur a housing boom.

That boom, which was exacerbated by a large cohort of millennials starting to hit their peak home-buying years, dried up housing inventory and sent buyers in search of new construction.

Home improvements and construction require a lot of lumber, and mills couldn’t keep up.

Fluctuating Plans:

So I’ve told myself I may be living here longer than I wanted to. Either to find a reasonably priced house to buy or to wait in line to get into a senior apartment complex.

I can’t see renting a house, as the prices for renting are outlandish now as well. And getting worse all the time.

It all kind of depends on who my next-door neighbor ends up being in a few weeks and what happens in this crazy market.

I scan the rentals and houses on the market every single day hoping things will level out.

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14 Comments

  1. Might be time to find a trusted real estate agent because they get info on the new sales coming on the market before the public does. If they know what you’re looking for and your budget, they will let you know as soon as something comes on the market and you might stand a better chance. I found it to be true in our case.

  2. We were going to have wood laid under the new flooring to even it out with the tiles in the hall and kitchen and not tear those out just level with wood to make it all the same height. When we found out the price of the wood it was cheaper to have someone tear out the ceramic and granite tiles instead of putting cheap floor board under the new floors. It was outrageous. I hope the market on homes will come back to reality and the prices of things.
    Have a good week. xoxo Kris

  3. Just wondering, are prices any better outside of Tulsa? I can understand how hard this must be when you feel unwell. We moved 6 years ago and NEVER want to move again! Best of luck to you and keep us informed!

    1. In the sixties I worked for an attorney. One client was a very old man who became rich right after World War II. He stockpiled wood and also built homes during that time knowing those waiting and returning after the conflict would need houses.
      This was in East Texas where the piney woods and forests are.

    2. Wood is more expensive everywhere. It is a world wide concern. The materials and shopping cost more. To add to this problem there was a ship stuck in the canal at the end of the lockdown. RhT delay all the shops waiting so delivery stopped. It will be better.

  4. Brenda, I feel bad for you, and for our second oldest son and family, too. They were set to build a home up North, but with lumber up over 500% here, it is not going to happen for a while. They have the cabin, but now that their two boys are both out of school, they thought about selling their home here, and live up North full time, instead of the drive every weekend. But, we’ll see..I wish you Good Luck, with the new neighbor. It’s hard after one makes up their mind to buy a house, or move, to put your dreams on hold. Hang in there, Brenda, things (hopefully) are going to get better!!!!

  5. Once the demand for lumber and all building materials for that matter have been met due to mills trying to catch up, things will ease up. Factories, businesses, food plants, all are playing catch up due to shutdowns with less workers, illness preventing them from opening, you name it, it happened and patience is now our strength to get back on track. Demands are high for anything home related as it’s been our safety net for awhile now. Housing to meet various needs will come along for you too. Enjoy your gardens and patio and see what happens. And talk to store workers when you are at a nursery or food store cause sometimes they can lead you to a place right in the neighborhood you don’t even know about.

  6. I think you should wait it out until things settle down. You don’t have to move and your new neighbor might be someone who you really can get along with!

    1. JoyceD, Your comment is very good advice. In the five years we rented, we had 4 neighbors. I reached out to every new neighbors….welcome to the community. Always stopped to chat. I’m a retired chef any time I made cookies I took a baggie to our neighbors. Did not mean we did not have to ask them to turn down their music or pick up the pet waste. But I’ve always been one to try and reach out in my community.

  7. Sit tight for a while. You have no NEED to move and it would be foolish to do so when prices are at their peak. I hope you will find a subsidized senior complex as it will meet your long term needs without a lengthy and expensive commitment.

  8. We wish we were in a much better suited location too…but it is insane and crazy here too, so likely we are stuck for awhile. I hope you get decent neighbors next…as you know I nearly went bonkers with one nutty person we had over us for almost 9 months…seems a rather long sentence to serve in a prison during such. I appreciate being able to rest ok now…but it can change overnight as we all know!!