Materials Shortages a Positive Sign for New Home Builders

In what could be termed “good news” for the building industry, builders and lumber companies are reporting shortages of materials according to recent surveys by the National Association of Home Builders (NAHB) and the National Lumber and Building Material Dealers Association (NLBMDA).  These materials include but are not limited to the following: oriented strand board (OSB), with 22 percent of builders reporting shortages, followed by wall board (20 percent), framing lumber (18 percent) and plywood (18 percent).

Items that are typically hard to come by, such as, copper wire, vinyl siding, HVAC equipment, insulation and structural insulated panels show the same “unavailability” as they did in 2004 and 2005 when the real estate market was stable and producing approximately 1.8 million homes annually.  The shortfall of the products listed above, though, indicate that companies are still not ready to “stockpile” material inventory that is used regularly by a thriving real estate industry.

With the post-Recession, record-breaking numbers and statistics emerging recently from the National Association of Home Builders, this shortage of materials would bolster the perception to builders that the housing industry is on the rise.  This cautiously optimistic view is tempered slightly by the inflation of the cost of building materials.  Builders have reported a 5.17% rise in materials costs, while distributors, specifically the lumber companies surveyed by the NAHB, report a 10% (or more) increase in cost.

This should come as no surprise for consumers who “live in the United States,” as the cost of, well everything, has been going up during and since the end of the Recession.  As the building industry balances out, and the new normal of supply and demand is established according to the new pace of the home building/buying industry, one would expect to see these prices level off.  They may not ever retract, but the rise of the cost of materials may cap as demand increases.

Altogether, though, the outlook for builders is positive, and builders seem to think so also, showing higher builder confidence numbers than they have since 2008.  Here at The Parks of Plaquemines in Greater New Orleans, we see many new homes being built by our builders.  Also, there seems to be a lot of interest in building on our lots as our Garden Home Phase I lots are Sold Out.  If you are interested in building your new home on one of our lots at The Parks of Plaquemines, Contact Us at 504-364-2350 or E-mail

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