Skyrocketing Lumber Prices Could Slow Housing Boom

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.

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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.

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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.

www.foxbusiness.com/economy/lumber-prices-housing-market-impact

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