🏗️🚨 THE COST TO BUILD A HOME IS STILL GOING UP 🏠📈
Everyone watches mortgage rates...
But here's another number that could have a BIG impact on the housing market:
Building material prices jumped 5.0% year over year in July.
And some materials are moving MUCH faster than that.
🌲 Softwood lumber: +17.3% YoY
🏗️ Building materials overall: +5.0% YoY
🏠 Residential construction inputs: +6.5% YoY
⚡ Energy inputs: +33.1% YoY
🚚 Transportation & warehousing services: +10.9% YoY
🔧 Trade services: +7.0% YoY
There's another number that really caught my attention...
📈 Softwood lumber prices jumped 7.4% in July alone.
Meanwhile, ready-mix concrete was up only 2.2% from a year ago.
So why does this matter?
Because the cost of a home doesn't start with the mortgage.
It starts with:
➡️ Land
➡️ Materials
➡️ Labor
➡️ Transportation
➡️ Financing
➡️ Construction
And when those costs continue rising, builders have a difficult decision to make.
They can:
💰 Raise prices
🐢 Slow construction
📉 Reduce margins
🏗️ Build fewer homes
🎯 Focus on higher-margin projects
None of those options magically creates more affordable housing.
And remember the story we talked about recently...
Builders are already reporting tighter credit conditions and higher financing costs.
Now add rising construction costs on top of that.
🔥 That's a combination worth watching.
The housing market isn't just a question of:
"Where are mortgage rates going?"
It's also:
"What will it cost to build the next house?"
And if the cost of creating new supply keeps rising, that could become an important piece of the home-price puzzle.
💭 What do you think happens next?
👇 Do builders absorb the higher costs, raise new-home prices, or simply build fewer homes?
📲 #JustCallWilliam
📞 630-881-8655
#HousingMarket #RealEstate #Mortgage #NewConstruction #HomeBuilders #BuildingMaterials #Lumber #HousingSupply #HomePrices #InterestRates #RealEstateInvesting #Homebuyers #IllinoisRealEstate #ChicagoSuburbs #Naperville #JustCallWilliam 🏡📊🔑
Everyone watches mortgage rates...
But here's another number that could have a BIG impact on the housing market:
Building material prices jumped 5.0% year over year in July.
And some materials are moving MUCH faster than that.
🌲 Softwood lumber: +17.3% YoY
🏗️ Building materials overall: +5.0% YoY
🏠 Residential construction inputs: +6.5% YoY
⚡ Energy inputs: +33.1% YoY
🚚 Transportation & warehousing services: +10.9% YoY
🔧 Trade services: +7.0% YoY
There's another number that really caught my attention...
📈 Softwood lumber prices jumped 7.4% in July alone.
Meanwhile, ready-mix concrete was up only 2.2% from a year ago.
So why does this matter?
Because the cost of a home doesn't start with the mortgage.
It starts with:
➡️ Land
➡️ Materials
➡️ Labor
➡️ Transportation
➡️ Financing
➡️ Construction
And when those costs continue rising, builders have a difficult decision to make.
They can:
💰 Raise prices
🐢 Slow construction
📉 Reduce margins
🏗️ Build fewer homes
🎯 Focus on higher-margin projects
None of those options magically creates more affordable housing.
And remember the story we talked about recently...
Builders are already reporting tighter credit conditions and higher financing costs.
Now add rising construction costs on top of that.
🔥 That's a combination worth watching.
The housing market isn't just a question of:
"Where are mortgage rates going?"
It's also:
"What will it cost to build the next house?"
And if the cost of creating new supply keeps rising, that could become an important piece of the home-price puzzle.
💭 What do you think happens next?
👇 Do builders absorb the higher costs, raise new-home prices, or simply build fewer homes?
📲 #JustCallWilliam
📞 630-881-8655
#HousingMarket #RealEstate #Mortgage #NewConstruction #HomeBuilders #BuildingMaterials #Lumber #HousingSupply #HomePrices #InterestRates #RealEstateInvesting #Homebuyers #IllinoisRealEstate #ChicagoSuburbs #Naperville #JustCallWilliam 🏡📊🔑
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