Building Materials Post Record Price Hikes Through July
authors QR Staff | August 17, 2021
Building material prices, including the cost of steel-mill products, softwood lumber and gypsum products, continued their record year-over-year increase in July, the National Association of Home Builders reported this month.
Citing the latest monthly Producer Price Index (PPI) report released by the U.S. Bureau of Labor Statistics, the NAHB reported that prices paid for goods used in residential construction (excluding energy) rose 0.2 percent in July after climbing 3 percent in June and have risen 13 percent year-to-date. Building materials prices have increased 19.4 percent over the past 12 months and have declined just twice since December 2019, according to the Washington, D.C.-based NAHB. The record year-to-date increase stands in stark contrast with the same period in 2020, during which prices increased only 1.1 percent, the trade association noted.
Steel mill products prices rose 10.8 percent in July, following a 6.2 percent increase in June, according to the NAHB, which reported that the pace of increases has accelerated each of the last two months, with prices climbing 108.6 percent over the past 12 months, and 87.6 percent in 2021 alone. The seasonally adjusted PPI for softwood lumber declined 29.0 percent in July, the largest monthly decline since tracking of the series began in 1947, the NAHB said. But while the PPI for softwood lumber has fallen 29.5 percent from its peak, it remains 71.9 percent above its January 2020 level, while prices paid for gypsum products rose 2.5 percent in July and are up 15.8 percent year to date, according to the NAHB.
“Although the direction of the softwood lumber index value change is encouraging, the continued volatility is not,” the NAHB said, adding that price volatility, as measured by the PPI, remains at an all-time high for a 12-month period.