By Don Magruder
The February 2024 RoMac Building Supply Whole House Commodity Index dropped a meager .2 percent from January to $51,073 despite some price gyrations within the Index. The 2.0 percent increase from the prior month stuck, and as spring warms up the job sites, expect subdued lumber prices to rebound. The housing market will have to contend longer with higher interest rates and increasing costs, but the shortage of available housing will soon force buyers into the market who have been reluctant to buy over the last year.
The following are the significant price movers on the Index this month.
Foundation poly dropped 14.3 percent on ample supply and first-of-year specials.
Foundation wire mesh added 3.8 percent while rebar added 9.3 percent as scrap metal pricing continues to feel upward pressure.
Mortar pricing was up 2.6 percent on higher costs.
CDX plywood decreased by 2.7 percent, but OSB sheathing added 5.4 percent.
2x4 yellow pine gave back 11.3 percent while 2x6 retreated 4.5 percent and 2x12 increased in cost 13.0 percent. The wider the width, the higher the price was the theme due to log availability.
2x4 dimensional spruce dropped 4.7 percent while studs and 2x6 spruce remained flat in pricing.
Roof truss prices dropped 4.2 percent on lower lumber costs.
Drywall pricing was up plus 5 percent on price increases from the manufacturer.
Doors added 3 to 5 percent on increased door slab costs from manufacturers.
Vinyl soffit dropped 5.1 percent on lower costs.
Prices on the Index versus last year are up 3.2 percent which is in line with reported inflation from the government. Anticipation is that as the weather warms and the housing equation improves in the spring, pressure will mount for increased pricing. There are signs of increased builder activity with more permits being issued, higher demand for quotes and estimates, and more land activity by developers. Builders should not use current pricing to bid on projects later this spring and summer, and most importantly, don’t delay in lining up subcontractors as labor pressures will probably increase.
There is a good chance of a very good spring home selling season and now is the time to prepare.
The RoMac Building Supply Whole House Commodity Index is based on wholesale costs of the base components to build a 2,200-square-foot wood frame home with a concrete stem wall in Central Florida. The Index includes foundation, metal, concrete, block, stucco, cement, wood framing, siding, sheathings, trusses, roofing, drywall, insulation, windows, doors, trim, garage doors, and most building hardware. It does not include décor, electrical, plumbing, mechanical, landscaping, or labor. Because the Index uses current wholesale costs, this should be a strong indicator of the direction of building prices for the next 30-45 days. Don Magruder is the Chief Executive Officer of RoMac Building Supply in Central Florida.
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