Extreme lumber prices had a big impact on K12 development. Lumber prices have been extraordinarily volatile over the past year, driving the average price of any project up. Many K12 school projects were put off due to these outrageous prices. Since the beginning of the pandemic, lumber prices have been more volatile than at almost any other time in history, leading to some major headaches for those seeking to develop school building projects.
The good news? With interest rates rising and the housing market cooling, demand for lumber is finally subsiding. That means it may finally be time to resume that building project you’ve been putting off.
Prices Finally Subside
The Covid-19 pandemic affected countless industries worldwide, K12 education being a big one. Skyrocketing lumber prices meant that school renovations, repairs and new construction were all much more expensive, affecting the overall cost of building projects. Two years after the global shutdowns, the cost of lumber finally seems to be decreasing toward pre-pandemic levels. This is fantastic news for K12 architecture and design!
Why So Expensive?!
At the beginning of the pandemic, the cost of lumber and other building materials skyrocketed due to a variety of factors. First, lumber mills were forced to close or reduce their production capacity during the emerging global health crisis. Second, many people undertook DIY and renovation projects in 2020 because they were spending more time at home or working from home. Inflation further affected the cost of lumber.
How Lumber Costs Affect K12 Building Projects
Wood framing is used to build many K12 schools in America. The average school could have required hundreds of thousands – if not millions – of dollar’s worth of lumber. Without a doubt, the cost of lumber has a significant impact on the construction industry.
Is the Bubble Bursting?
After two years of unprecedented volatility and outrageous price increases, the lumber bubble seems to have finally popped. This is all due to rising mortgage rates and inflation, which have contributed to the housing market cool down. With lower demand for new homes, the cost of lumber is falling. As of writing this, lumber prices have decreased nearly 50% since this time last year.
While prices are lower now than they were in the last couple of years, we are understandably concerned about continued instability. Luckily, experts are predicting that – assuming we manage to avoid another major worldwide crisis – lumber prices should stabilize in the coming months.
Interested in learning more about how falling lumber prices might affect your next project? We can help with that! Click here to learn more.