NICHOLASVILLE, Ky. (LEX 18) — A Lexington-based home builder says he's hopeful the market will soon level off after the pandemic caused sky-high materials prices and unstable supply chains.
Lumber prices have increased more than 300% since April 2020 and the average price of a new single-family home increased by nearly $36,000, according to the National Association of Home Builders.
But since the peak cost of lumber in May, prices have been declining. According to a NAHB graph, a sign of relief may be on the way for James Monroe, owner of James Monroe Homes.
"We just want to stabilize the market," Monroe said. "We want pricings to stabilize so consumers have the confidence of knowing what they're paying is not the high or the low but just consistent across the board."
The pandemic caused disruptions in the supply chain for the Lexington-based company with ongoing projects in Nicholasville and Richmond. It's meant big changes as far as the timing of orders.
"Before, I could call the lumber yard and order lumber to be delivered tomorrow," Monroe said. "Now I might have to give them 30 or 45 days' notice to make sure I get the lumber when we need."
Monroe said that his team talks to suppliers daily, and worked with a structural engineer to use less lumber where possible and eliminate waste.
"We're ordering things earlier and earlier," he said. "There are some supplies that we're ordering as soon as we get the building permit."
But while he's glad to see lumber prices drop, Monroe still has concerns about supply.
"As long as the demand is as high as it is and builders need more than what's available, the prices are going to continue to go up," he said.
A stable supply chain would give him greater confidence in his building plans, he said, and give his customers more confidence to purchase a home.