How the Current Lumber Shortage Impacts Home Buyers
Home prices are soaring around the country making it a challenging time for buyers. One factor impacting the increase in home prices is the high price of lumber. The price of lumber has increased by 30% over the last year due to increased demand and decreased supply.
Why is Lumber Supply Low?
When COVID-19 hit a year ago, lumber production dropped. Even after people returned to work, production remained reduced to accommodate for new workplace safety regulations. Many lumber producers are still not back at capacity. It will take time for lumber production to stabilize.
At the same time, more people were stuck at home and began home renovation projects. The demand for lumber increased from current homeowners desiring to add fencing, new home offices, and other new features to their homes.
This combination of decreased production and increased demand drove prices up.
How Decreased Lumber Supply Impacts Housing
Most people don’t think about the lumber supply very often. But, if you are currently trying to purchase a home, you are feeling the effects.
The lumber shortage slowed new home construction. The real estate market is experiencing a shortage of inventory from the decrease in building new homes. Building fewer homes means a lower supply of houses for sale.
Even before COVID-19 hit, inventory rates for homes were low. The impact of the pandemic only made the problem worse. Now, people wishing to purchase a home face high prices and lots of competition.
Don’t Panic in the Buying Process
Many economists don’t see the current housing price increases as a real estate bubble, meaning prices aren’t likely to plummet after supply levels out. However, the buying frenzy may settle down once the supply stabilizes.
As a home buyer, you need to remain patient and not panic. Buying a home is still a serious decision. In fact, it’s most people’s largest financial investment. Don’t make a hasty decision or let emotion take over in the buying process.
Work with a real estate agent you trust to guide you so that you don’t overspend or take shortcuts.
Don’t Skip the Home Inspection
Even when competition is high, it’s not smart to purchase a home without an inspection. If you are extending your buying budget to purchase a home above the asking price or due to a bidding war, how will you cover surprise repairs?
The purpose of a home inspection is to evaluate the current condition of a home. The home inspection is your protection against surprise issues, like a bad roof, moisture damage, broken HVAC, structural problems, and other major issues in a home.
Kenco Home Inspections Is On Your Side
As the market levels out, homebuyers will find more options to choose from. While prices may not drop, waiting for the right home may mean a better investment in the long run.
At Kenco Home Inspections, we’ve served Southeast Florida communities with reliable and quality inspection services for over 15 years. We want the best for our clients and our community.
Contact us today to schedule a home inspection before you buy.