Skip to main content

In Two Years, Building Material Costs Have Risen Almost A Third

Keith Griffin
Mar 21, 2022
National Association of Home Builders February 2022 Price Input
Building material prices increased 20.4%, year over year, and have risen 31.3% since January 2020.
National Association of Home Builders

NAHB research shows, however, that the costs for some building materials are experiencing declines.

KEY TAKEAWAYS
  • Building material prices increased 20.4%.
  • Softwood lumber prices jump 79.5% in six months.
  • Steel mill products prices declined 9.9%.

The cost of building supplies continues to outpace inflation, according to data compiled by the National Association of Home Builders.

Building material prices increased 20.4%, year over year, and have risen 31.3% since January 2020. NAHB based its conclusions on research from the Federal Bureau of Labor Statistics (BLS) for February 2022.

The Producer Price Index (PPI) for softwood lumber, seasonally adjusted, increased 2.6% in February following a combined 28.9% increase over the previous two months, NAHB reported. In six months, prices have increased 79.5%. According to Random Lengths, a company that tracks and analyses data from the lumber industrty, the “mill price” of framing lumber has more than tripled since late August.

The PPI for ready-mix concrete (RMC) rose 0.8% in February after increasing 1.1% in January. The index for RMC has been relatively volatile since mid-2020 and has climbed 8.2%, year over year. Prior to January 2021, year-over-year price increases had not exceeded 8% since December 2006.

Not all segments are seeing continued price spikes. After a 12-month period during which the prices of exterior and interior paint increased 30.3% and 21.2%, respectively, NAHB determined paint prices held relatively steady in February. The prices of exterior architectural coatings gained 0.1%, and interior architectural coatings PPI rose 0.3%.

Some segments showed declines. Steel mill products prices declined 9.9% in February, the second consecutive decrease after increases in each of the prior 15 months. The last time the steel mill products PPI decreased more than 9% was December 2008. While January and February have been good months for the cost of derivative steel products, the PPI remains 74.4% greater than it was 12 months ago, the NAHB said.

The PPI for gypsum products declined 1.9% in February, snapping an 11-month streak of increases during which the index climbed 31.4%. Gypsum products prices are up 20.7%, year over year. Among other uses, gypsum is found in plasterboard or drywall.

Published
Mar 21, 2022
Fannie Mae: Banking System Instability Could Cause Recession

ESR Group says housing activity expected to remain subdued.

Mar 24, 2023
House Flipping Up, Profits Down In 2022: ATTOM

House flips reached their highest level in 17 years, but ROI was lowest since 2008.

Mar 24, 2023
New-Home Sales Rose For 3rd Straight Month

Supply of houses for sale fell for the fourth straight month.

Mar 23, 2023
Feeling Like A 'Crash Test Dummy'

Rate-sensitive housing market buckles up after the Fed tries again to slow the economy.

Mar 23, 2023
Mortgage Application Payments Rose 4.9% In February

MBA said it expects mortgage rates to decline later this year.

Mar 23, 2023
Down Payments In January Fell 10% YOY

Redfin says the typical down payment was $42,375, the lowest in nearly 2 years.

Mar 22, 2023