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Skyrocketing Costs Of Construction Materials Hits Both Consumers And Contractors


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Skyrocketing Costs of Construction Materials Hits Both Consumers and Contractors

April 6, 2021 12:50 am·
Author: Ron Wilshire
 

BAE4F52D-C741-4162-AAF5-40E9062FB56B-1-1JEFFERSON CO., Pa. (EYT) – Skyrocketing increases in construction supplies have surprised contractors and customers alike in Venango, Clarion, and Jefferson Counties.

(PHOTO ABOVE: Jeremy Dolby of Dolby Customs. Photo by Dave Cyphert of ProPoint Media Photography.)

Depending on the type of supply needed, contractors estimate the increase could range between 40 and 100 percent, with some customers putting off a project because of the higher prices. Despite the increases, work continues for contractors in the tri-county area.

When COVID-19 first struck, there were problems with a slowed-down supply chain, but there is now an adequate supply in stores, and the prices have increased dramatically.

Ron Gustafson, of Gustafson General Contracting, in Oil City, said there is a lot of activity that started before the rise in prices. Big projects in downtown Oil City that started before the increase in prices are mainly county- and state-funded projects based on transportation.

“I’ve been working out of here for about 35 years and what I’m hearing is that production slowed down on materials during the start of Covid and have remained up and down,” said Gustafson.

“I suppose some issues are out there, but sometimes, you know, suppliers are of the mind that they don’t want to let a good crisis go to waste when they are able to pump up prices.”

The prices for wood products, especially plywood are at ridiculous levels, according to Gustafson.

Ron Gustafson

Ron Gustafson, of Gustafson General Contracting.

Clarion County contractor Jeremy Dolby, of Dolby Customs, agrees.

“We do everything and anything, and we’re not just like a framing contractor. We do everything from the ground up, so we’re all over the place,” said Dolby who has a three-member crew.

“I would say on average, you’re looking at probably at least a 40 percent increase for sheet goods. I used to buy half-inch sheet of OSB for $9.00 a sheet, and now it’s $37.00 and change before tax right now.”

According to a published article in Builder Insights, building codes consider OSB (Oriented Strand Board) and plywood interchangeable and refer to both as “structural wood panels” as both OSB and plywood panels are created when the wood is glued and compressed to form a rigid panel. Despite the obvious similarities, there are some essential differences. From a structural standpoint, plywood and OSB panels are considered equitable, although their different manufacturing techniques give each board its advantages and disadvantages.

Gustafson estimated the sheeting increases at 100 percent.

“Sheeting is really common in building, receding wall sheeting, and so forth. It used to be an economical product. I think even 16th inch, which is a very common OSB, maybe a year ago was running $18.00 a sheet, and it’s now $37.00 to $40.00, depending on where you’re at.”

It’s also looking like home repairs may be a good investment.

U.S. home prices have soared, according to a published article in Goldman Sachs, rising at their fastest rate since 2006 as low-interest rates and supply constraints fueled a housing boom. Sachs thinks the rally has much further to go and upgraded its 2021 house-price appreciation forecast to 6.8 percent from 4.7 percent.

In Jefferson County, contractor Cory Holben, of Holben’s Construction and Remodeling, out of Brookville, is advising his customers to move ahead with projects while the goods are available.

“The cost of material has gone up, but a lot of customers don’t realize that,” said Holben. “By the time we get an estimate done, they’re like – ‘Wow, that’s a lot of money!’ Sometimes, it is because everything’s going up, and it’s just not what — it’s everything. You can lose a lot of jobs because people don’t want to pay that much money. They want to wait it out and wait until it goes down.”

Holben also feels the pandemic has also influenced people about home remodeling projects.

“I think everybody from this pandemic has or is sitting at home, and they’re bored,” said Holben. “They’re just like – ‘Well, let’s upgrade this or let’s do this,’ and they like to spend money. I’ve seen more work in the last year than I’ve seen in a while because of the pandemic. I honestly feel there’s a lot of people that are sitting at home, and they’re thinking why don’t we just remodel our bathroom?

“There are still people out there that didn’t get affected by the pandemic, but they hear that all of their other friends getting stuff done. So, then they went and get stuff done. So, I mean, it’s just a circle. It just keeps going around and around.”

Holben has been in business for five years and really can’t complain about the amount of business. He is down to just himself working, but he does like the challenges and is able to navigate the supply challenges.

“Boards are expensive, but I have multiple suppliers. I don’t pick just one and bounce between a bunch because everybody has different prices.”

As the name implies, Dolby Customs works on more specialty projects.

“We’ll do cookie-cutter, but I think now we’re kind of known for the more unique, anything from historical restoration to ‘I’ve got this idea and I can’t find anybody who’s willing to make it work – can you come and take a look’,” said Jeremy Dolby.

Dolby said the rising cost has had a minimal impact on his business, and he found that surprising.

“I expected to lose more than we have so far. Most of my clients are still willing to proceed, and we do what we can to cut costs,” Dolby added.

Chad Reed of Dolby Customs. Photo by Dave Cyphert of ProPoint Media Photography.

Chad Reed of Dolby Customs. Photo by Dave Cyphert of ProPoint Media Photography.

Based in Lucinda, Dolby Customs now includes two employees plus Jeremy.

“I’d like to be back to a four-man crew, but it’s kind of difficult to find anybody worth their weight right now. I don’t mind teaching some guys, but it’s hard to find somebody who’s actually got the motivation to learn. I think if we’re going to bring a fourth guy back in, it’s got to be somebody with some experience.”

Along with increasing prices, finding qualified workers is another problem facing all businesses.

Ron Gustafson has worked on some larger projects in Oil City but is also down in the number of his staff.

“I usually have five employees, but right now I’m working with three,” said Ron, who is also a third-term Oil City Council member. “I’m just finishing up some projects, but I’m getting a little close to retirement and not looking to expand. I’m not sure how, how much I want to participate in this material market.”

Gustafson said his company was shut down for a couple of weeks last spring, but business has been steady since then, and all of the contractors that he’s familiar with are really booked up.

“I don’t think that it has really hurt demand yet, but in a couple of instances, I’ve seen where people have become hesitant to invest the money in the extra material costs, thinking and hoping that it’ll come back down.”

Regardless of the skyrocketing increases in construction supplies, it appears that contractors in the tri-county area have more than enough projects to keep them busy.                                                                          https://www.explorejeffersonpa.com/skyrocketing-costs-of-construction-materials-hits-both-consumers-and-contractors/

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Lumber is ridiculously expensive right now. Here’s why — and what you should do

 

Demand is sky-high. Supply is worryingly low. What's the deal with our wood problem?

 
Popular Mechanics
Updated: 1:35 PM EDT May 1, 2021
 
 
 

The global demand for lumber has skyrocketed since the world went into lockdown. Consider this stat: Lumber prices have risen by 130% since before the COVID-19 pandemic, which makes for an estimated $24,000 difference in the cost of a newly constructed single-family home, per data from the National Association of Home Builders.

As of press time, the average lumber price is $1,372 per 1,000 board feet.

Accordingly, lumber futures have increased an astounding 375 percent between April 2020 and April 2021, Forbes reports. That basically means investors have sunk almost four times as much money into the same exact amount of wood compared to a year ago, because the spike shows no signs of stopping.

"The price of physical lumber seems like it still has to rise a bit more because mills are at capacity and unable to meet current demand," commodities expert Sal Gilbertie writes at Forbes. "Price rationing is really the only solution, and lumber prices have clearly begun the painful process of finding the highest price above which few people, be they professionals or DIYers, will pay."

Why is lumber so expensive right now?

How did we get here? You can blame a few factors. For starters, construction of new homes has steadily risen for the last few years, even before the pandemic. As wealth increases around the world, lumber demand increases with it, because lumber is a totally fungible good that translates into virtually every economic situation worldwide.

Second, think about your own pandemic behavior. Chances are you spent the last year at home trying to tackle new (or long-promised) DIY projects for your backyard, like, say, a pergola.

Naturally, the pandemic has increased consumer demand for lumber for such projects. Ditto for restaurants, which also had to build an unprecedented amount of outdoor seating spaces to comply with COVID-19 regulations.

"Businesses are beginning to face the challenge of producing adequate supplies of goods and services—whether of lumber or of cold beer — to satiate that resurgent demand," the New York Times reports. "After huge disruptions over the last year, the intricate networks by which major industries keep shelves full and services available have become frayed."

This is a key part of the pandemic narrative around the world. Every industry relies on a supply chain, and many of these have been disrupted or even wrecked in the last year.

That’s on top of regular shortages like steel and battery materials, unrelated to the pandemic, that occur in every industry from time to time. It’s a perfect storm of high demand and low infrastructural capacity.

What can you do?

If the price of lumber could keep rising without any sensible limit, where does that leave backyard builders like you?

"For small projects, you’re simply better off buying lumber than trying to substitute your labor for various workarounds," says Pop Mech’s senior home editor Roy Berendsohn. But if that just isn’t an option, you can follow a few backup strategies:

Strategy #1: Use reclaimed lumber.

"If you know a remodeler, ask them if they have a demolition project on their calendar," Berendsohn says. "Or if you know somebody who is planning a remodeling job, see if you can handle some portion of the demo work in return for the lumber."

You might even reclaim some lumber from your own underused furnishings. "Are there old attic or basement shelves that can be repurposed? Is there an old bookcase that can be cut apart and repurposed?" Consider being a little more careful than normal and reuse the valuable scrap, Berendsohn recommends.

Strategy #2: Use wooden pallets.

Pallets have a special disincentive for most kinds of recycling because they’re made of both hard and soft wood. "Many times, disposing of pallets poses such a nuisance to a company that they may be yours for the asking," Berendsohn says. From there, you can break or cut them up into whatever materials you need.

Strategy #3: Consider alternative materials.

This is more of an ideological choice than one that will save you money, Berendsohn admits. But if you want to use less lumber, or you’re just tired of looking at the empty racks at your local home repair goods superstore, consider reframing your project—literally.

"Will some small concrete blocks substitute for that lumber you were going to use for that raised garden bed?" says Berendsohn. "Maybe rocks for the raised bed?"

Strategy #4: Avoid wasting lumber.

This is key. If all you can grab is a single sheet of plywood, plan your project carefully so you cut just what you need in the shapes you need, Berendson advises. But it goes further than that. Think about stock lumber sizes and plan to use whole cuts or as close as you can get.

You might have to do some math, but you won’t end up needing to cut and use six inches from an entire 2x4. In the same vein, consider checking with the lumber department at your local home repair superstore. The staff will likely have some offcuts you can use, rather than just buying whole new stock cuts.                                                                                                                      SEE VIDEO REPORT    ;    https://www.wtae.com/article/lumber-shortage-prices-2021-why-lumber-is-so-expensive/36307633

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21 minutes ago, pennstater said:

BIDENOMICS!

 

Aint it awesome.  

Bidenomics??  Here's one from this week:

“When we were when I was vice president with Barack he allowed me to put together a budget for Amtrak and it had money for high-speed rail at 200 miles an hour from from uh uh Char excuse me Charlotte one and another line going from in Florida down to Tampa and another line if we had moved Gov we’d have that tunnel fixed in New York now. The money was there to get it done.”

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59 minutes ago, Basset3 said:

Bidenomics??  Here's one from this week:

“When we were when I was vice president with Barack he allowed me to put together a budget for Amtrak and it had money for high-speed rail at 200 miles an hour from from uh uh Char excuse me Charlotte one and another line going from in Florida down to Tampa and another line if we had moved Gov we’d have that tunnel fixed in New York now. The money was there to get it done.”

Lol. 
 

yeah. BIDENOMICS.  Over 6 trillion and counting in the first hundred days.  It’s Biden’s economy.  It’s like giving a limitless credit card to a child.  

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14 minutes ago, Jeff said:

Wow, no Trump did this or that because there is no way to blame trump for any of this crap now. The blame falls directly on the Democrats and the brain dead voters that vote for them. 

The Teachers union is controlling Biden. If they have been vaccinated, go back to work or lose your job. PERIOD. 

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4 hours ago, pennstater said:

BIDENOMICS!

 

Aint it awesome.  

And their just throwing it in our faces.  These anti-Americans needs removed from the face of this earth or at least make the practicing of Liberalism punishable by exile. Get them the hell out of our country NOW.

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