They say that money doesn’t grow on trees but, over the last 20 months, it started to feel as though maybe it did. If you were one of thousands of Canadians who thought of building a new house or renovating your existing home after the global pandemic hit, you know all too well that lumber shortages were prevalent and prices were soaring.
During COVID-19, the importance of home took on new meaning, and the desire to complete home improvement projects, or retrofit work-from-home spaces reached new heights. For would-be buyers, supply shortages and excessive prices in a sizzling resale market led many to consider building instead of buying. Construction materials were snapped up by consumers and builders alike, spurring an increase in demand and leaving lumber mills struggling to keep up, some even having to close their doors due to safety protocols. Surrendering to the age-old relationship of supply and demand, many people were forced to either postpone or pay higher prices for their well-intended plans.
Lumber prices dropping
But as Newton’s third law of motion dictates, what goes up eventually comes down, and that’s good news for builders and DIYers. With the reopening of business, sawmills are able to ramp up production and, with more people returning to work, the demand for do-it-yourself projects has lessened.
As a result, lumber and building prices have begun falling and may drop further as construction slows during the colder months ahead. Retailers left with pent-up inventory are looking to unload their surplus, likely at reduced prices, meaning those who sidelined their projects or were reluctant to pay higher costs can now benefit from stabilized pricing. This is critical to both new home construction and renovation industries, which contribute to the overall health of our economy and labour force and, in turn, benefits the end-user.
The effects of the pandemic on industries around the globe have been – and continue to be – far reaching, but perhaps none as extreme as housing. Whether buying or selling, building or renovating, Canadians are spending a great deal on the place they call home. But, as we cheer on the return to normal as construction and renovation projects resume, we should do so cautiously because, while lumber prices have dropped, pandemic-driven supply chain challenges still linger.
The pandemic has taught us many valuable lessons, not the least of which is that life is unpredictable and it’s important to seize every moment of every day. So, if you’re ready to dust off your toolbelt and work gloves again, or get your new build back on track, there’s really no time like the present.
Thinking of building a new home or renovating your existing one? Affordable financing solutions are a call or email away!