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The cost of lumber has increased by almost 300 percent since last spring when COVID-19 lockdowns silenced sawmills in North America, shrinking future supplies. That and an increased demand for housing, especially in places such as the Highland Lakes, has led to a rise in home costs across the country. 

According to the National Association of Home Builders, soaring lumber costs add about $36,000 to the price of an average new single-family home. Construction costs for apartment complexes and multi-family housing add about $119 to monthly rents. 

“We’re definitely feeling it,” said Dan Burdett of Burdett Homes, a custom builder in the Highland Lakes. 

The company’s crews tackle only a handful of homes — five to 10 — a year. He feels the pinch a bit more than higher-volume builders who can buy materials in bulk and possibly secure better prices. 

“A year ago, the cost was about $350 per 1,000 board-feet for lumber,” Burdett said. “About a month ago, it climbed to $1,711. But today (May 28), it’s around $1,400. I feel like we’ve come off the top, but it’s still high compared to where we were last year.”

Concern over the lumber shortage recently reached the floor of the U.S. Senate and is part of an ongoing tariff debate between the United States and Canada.  

In mid-May, during congressional hearings on the rising costs of lumber prices, U.S. Trade Representative Katherine Tai testified that the United States and Canada are discussing eliminating a 9 percent duty tariff on Canadian softwood lumber products, which are used in home construction. 

Initially, when imposed in 2017 as part of the newly negotiated North American Free Trade Agreement, the tariff averaged 20 percent on lumber imports from Canada. It was reduced in December 2020 to its current level. When the tariff was imposed, Canada called it an “unfair and punitive duty.” 

A spokesperson for Canada’s trade ministry told reporters shortly after Tai’s testimony that America’s northern neighbor “believes a negotiated agreement is possible and in the best interests of both countries.” 

It’s not just the price of lumber and wood products going up.

“It’s everything,” Burdett said. “Steel has doubled since October. Metal roofing is up. Spray-home insulation, it’s up about 50 percent. Pretty much everything you need to build a home has increased in price.”

Steel mill product price volatility in the United States is greater than any time since the Great Recession in 2008, said David Logan, a senior economist with the National Association of Home Builders.

“Over the past three months, prices have climbed 22 percent,” he said in a statement. “Perhaps more concerning than rising prices is that the pace of price changes has quickened each of the past nine months.”

Ready-mix concrete prices, which also have risen, demonstrated “unusual volatility,” he added. 

The shutdown of sawmills is not the only reason for a dip in supplies and an increase in prices. During the COVID-19 pandemic, many homeowners had more time on their hands and extra money that might normally have been spent on travel. 

“People were sitting at home being paid a good amount of money to sit there, and they were bored,” said Matt Winsborough, president of the Hill Country Builders Association. Winsborough Construction Inc. and the association are both located in Marble Falls. “They go to Home Depot and buy lumber to build a deck or a shed. The lumber is being bought up but not produced. It started a chain reaction to a shortage.”

The remodeling market grew by 7 percent in 2020, along with a jump in do-it-yourself projects that are not reflected in the remodeling numbers but still add to the demand for lumber products. 

“I think it’s still a strong marketplace,” Burdett said. “We always think we paid too much, but in 10, 15, 20 years, you don’t recall how much you paid, but you do remember all the great memories and times you’ve had.”

This story is part of a series on post-pandemic growth in the Highland Lakes. “Growing Pains” stories will be posted online throughout June on The series kicked off in the June edition of The Picayune Magazine. Other stories can be found here and here.