Construction material price spikes and shortages still hammer D-FW homebuilders

Nathan Law

Price tags for new homes in Dallas-Fort Worth and around the country have skyrocketed in the last year as builder construction costs have risen. While lumber costs have moderated since last year, other expenses are still going up. “Prices have really climbed in respect to new homes,” said Ted Wilson, […]

Price tags for new homes in Dallas-Fort Worth and around the country have skyrocketed in the last year as builder construction costs have risen.

While lumber costs have moderated since last year, other expenses are still going up.

“Prices have really climbed in respect to new homes,” said Ted Wilson, principal with Dallas-based housing analyst Residential Strategies Inc. “Even the most affordable houses that are out there — under $300,000, with the same plan — are up $48,000 in price year-over-year.”

The main reason new house prices have jumped over the past year is that building materials costs — everything from lumber to appliances — have shot up.

Lumber costs have come down in the last few months, but builders and construction supply companies say they are still bedeviled by price spikes and shortages.

“The scarcest items we hear now are brick and windows,” Wilson said. “It probably won’t be until the fourth quarter until we see where prices are headed.”

Don Dykstra, chairman of North Texas-based Bloomfield Homes, said costs of labor and some materials are still rising.

“Lumber prices are down significantly, and builders are starting to see reductions,” Dykstra said. “Windows are still challenging.

“Anything with resin in it is challenging in both cost and supply.”

Delays in obtaining materials have added three to four months to average home construction times, he said.

Dave Flitman, CEO of Dallas-based Builders FirstSource — the country’s largest manufacturer and supplier of building materials — said the construction industry is still fighting against supply chain tangles.

“It’s really been just about every building product you can think of,” Flitman said. “We sell a lot of windows and doors, and those have been in tight supply.

“We’ve heard stories from builders about not being able to close on homes because they couldn’t get appliances,” he said. “Hopefully, that’s easing a bit.”

Flitman’s best news is that lumber prices are now back to within 10% of where they were before the pandemic run-up in costs. The wood products price bubble was blamed on everything from individual workers calling out because of COVID-19 to whole mills that were shut down.

Some wood products are still priced out of sight, said Phil Crone, executive officer at the Dallas Builders Association.

“Framing lumber — studs have decreased and that’s the chart most people reference,” Crone said. “However, it doesn’t include oriented strand board, trusses and composite lumber, which are still around record highs.”

Crone said the builders association has had delays in reconstruction of its own offices because it can’t get the heating and air conditioning equipment it needs.

“We are still playing whack-a-mole on material pricing and supply chain problems every day,” he said. “There are a lot of frustrated builders out there.”

Builders are struggling to finish houses.

“It’s not just the material that is the constraint, we are also hearing about shipping delays that are causing a lot of the issues,” said Adam Stetson, division president with Storybuilt Homes. “The day before the truck is supposed to come in and it doesn’t come in.

“There is a lot of schedule adjusting going on.”

Stetson said some builders have also suffered thefts of materials from job sites.

“Lumber was a big issue for a long time,” he said. “It’s still something we are working through, but the pricing has come down.

“They anticipate lumber will continue to come down and normalize.”

A home under construction in August at The Grove development on Copperbeach Street in Frisco.
A home under construction in August at The Grove development on Copperbeach Street in Frisco.(Lola Gomez / Staff Photographer)
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