2022 Rising Costs & Inflation in the Home Improvement Industry
The roofing and home improvement industry isn’t immune to the inflation and delays other industries are experiencing. Quite the opposite, actually. Contractors of all specialties are facing a plethora of issues, including rising material prices and delays, labor shortages, and rising interest rates. These rising costs have greatly affected the consumer as well.
The roofing and home improvement industry isn’t immune to the inflation and delays other industries are experiencing. Quite the opposite, actually. Contractors of all specialties are facing a plethora of issues, including rising material prices and delays, labor shortages, and rising interest rates. These rising costs have greatly affected the consumer as well.
According to eyeonhousing.org, material prices and availability are the number one issue that contractors are facing currently. This widespread problem was reported to be an issue for 96% of builders in 2021, and 91% expect rising prices to remain on the top of the list of issues. Shortages in supplies and supply chain disruptions have also slowed things down significantly for 91% of builders in 2021, with about 90% expecting this issue to continue throughout 2022.
Inflation in lumber prices has been at an all time high in the last couple years. While there have been a few times of relief from these hyper inflated prices, they are currently on the rise again. It’s estimated that these rises in lumber costs have increased the cost of building a home by $18,600, according to The National Association of Homebuilders in a recent article on Poynter.com. This rise has also increased the price of building multi family homes by $7,300 thus increasing rent prices by $67 a month. Not only do these costs and delays affect new construction, they affect roofing repairs, home renovations and everything in between. Here at Bourbon Country, we’ve seen 7/16th OSB increase in price from $20 to $50 over the last year.
There are several factors contributing to the increase in lumber prices from supply chain disruptions and increased demand to labor shortages at the saw mills, these issues have been ongoing and increasing since 2020. Wildfires and tariffs are newer issues that have been further pushing lumber prices up. While some industry experts were hopeful for some relief, falling prices aren’t something to expect as we enter into the second quarter of the year.
As a consumer, it's important to take all these things into consideration if you’re in the market for a new home, a new roof, or just looking for some minor updates. Material costs account for 40% of the total cost and knowing that ahead of time can decrease the chances of any surprises related to costs. Being an informed consumer around the increases in cost can help you make the right financial decision for yourself and your family.
Bourbon Country: Roofing, Exterior, and Custom Homes can help you with any questions you have about costs, financing and availability. Contact our team today!
