Lumber shortage creating challenges for home builders in Alabama


BIRMINGHAM, Ala. (WIAT) — A lumber shortage is leading to skyrocketing prices and creating challenges for both construction companies and for those interested in building homes.

Elliott Pike, owner of ELM Construction, said the price of a lumber package for a new home is up 250% over the last year. According to Pike, the problem took root in the early stages of the COVID-19 pandemic when lumber companies began cutting back on production in anticipation of a slowdown in demand. However, that slowdown never happened. Demand increased, leaving little supply to meet consumers’ needs.

“The slowdown and the re-ramping back up for production combined with record demand is kind of a perfect storm for these lumber prices we’re seeing,” Pike said.

This time last year, the average cost of a lumber package for a new home was about $25,000 according to Pike, who’s also past president of the Greater Birmingham Association of Home Builders. He said that same package now costs about $62,000. But prices can change between the time the construction company writes a contract and the time they order the material.

“That causes uncertainty and a little bit of anxiety when you don’t know for sure what something is going to cost,” he said. “It doesn’t make anybody overly comfortable, to be honest with you.”

Pike is not sure when the price of lumber will drop, but he doesn’t expect it to happen this year. He said it’s wise to consider your options if you’re thinking about building a home in the near future.

“Work closely with your builder or your modeler,” he said. “Try to make sure everything you’re doing is as efficient as possible. And if you’re waiting on prices to come down, you’re going to have to wait probably a long time for that to happen.”

Pike said the market will eventually correct itself, but he doesn’t expect prices to get back to pre-pandemic levels.

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