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Red-hot lumber prices may cool housing boom
Home furniture supply shortage causing delays
Furniture buyers are experiencing delays due to material shortages and increased costs. FOX Business’ Grady Trimble with more.
Soaring lumber prices are holding back a U.S. housing market.
The number of building permits issued in March rose 2.7% month over month to a seasonally adjusted annualized rate of 1.766 million. The uptick is a mere blip on the radar compared with the 19.4% increase in housing starts, which grew at their fastest pace in nearly 16 years. Typically, building begins within two months of issuance, according to the National Association of Home Builders.
Some developers have "held back on projects on the expectation that prices will soon fall back," wrote Matthew Pointon, senior property economist at the research firm Capital Economics.
MATERIALS SELECT SECTOR SPDR ETF
HOUSING SHORTAGE CROPS UP AS MILLENNIALS START BUYING HOUSES
Front-month lumber futures traded at CME Group have climbed 47% this year to $1,286 per thousand board feet. Prices are up 395% from their April 2020 pandemic low of below $260.