As we get further into fall we see in the news how weather can have a profound impact on our business. Local weather such as our mild winter, early spring and long summer have contributed to a bounce-back year for our industry. More distant weather can also have an impact on our business. We will learn in the next few weeks the projected impact of Hurricane Sandy on the supply chains and what this will mean for us over the coming months. Please remember that demand is already increasing in our industry and manufacturers have been slow to increase production in order to better balance supply and demand. If there should be a spike in demand from Hurricane Sandy this will impact prices as inventory levels have been kept low at the wholesale level and there is naturally lower inventory as we head into the winter months. Please work with your sales team to better understand how this may affect your projects moving forward. We will update you as more information becomes available.
Cost of Framing Continues Upward Trend
The demand for housing materials is improving. The rate of increases in framing materials has slowed to 5.4% over last month, but rates are still up 21% when compared to last year. Industry experts predict this slow and steady upward trend to continue throughout the fall season and into 2013.
OSB Demand Makes Surprising Turn
Although OSB prices are nowhere near the record-breaking highs of 2003-2005, there has been a surprising increase in OSB price this month. Industry professionals attribute the price inflation to demand exceeding supply. Some speculate that manufacturers have been reluctant to increase production because of the unpredictable nature of the recovering economy.
Annual U.S. Housing Characteristics Released
- The U.S. Census Bureau released its annual report on new housing built in 2011. Here are some of the highlights featured in Random Lengths:
- The average single-family house completed was 2,480 square feet compared to the average of 2,392 square feet in 2010. The average square footage of multi-family units built was 1,408.
- 39% of single-family homes had four or more bedrooms, 48% had three bedrooms and 19% of single-family homes sold had a three-car or larger size garage.
- The average sale price of a new single-family home was $267,900 compared to $272,900 in 2010, $270,900 in 2009 and $292,600 in 2008.
- The average price per square foot for new single-family homes sold was $83.38. Regionally prices were: $111.37 in the Northeast, $96.12 in the West, $87.53 in the Midwest, and $76.73 in the South.
- 62% of all new single-family homes sold were financed by conventional loans compared to 58% in 2010 and 62% in 2009. Loans financed by FHA-insured were 20% in 2011, 25% in 2010, and 24% in 2009.
- The average lot sizes were 16,663 square feet for all new single-family homes, 15,616 square feet for new homes in metropolitan areas, and 28,768 square feet for homes out of metro areas.
