If you’ve spent any time in a home improvement store like Lowes or Home Depot lately, you may have noticed current prices are not the same as pre-COVID prices. COVID has hit a lot of industries hard this last year, and the construction business has been no exception.
There are a couple reasons for this, which we will dive into in this blog post, but we also wanted to make sure and address the question many clients have been asking, and that is “what does this mean for the addition or renovation project I’ve been considering?”
If you’ve been considering making some changes to your home, this blog post is going to answer many of the questions you’ve most likely been asking yourself since COVID hit at the beginning of the year.
So, why are prices so high? First, production is low because factory and plant workers haven’t been able to come to work due to quarantines. The reduction in workers has consequently created a reduction in supply. Second, because borders are closed between countries, items that are produced outside of the US can’t be shipped into the country right now, making supply even more scarce.
And it doesn’t help that from the demand side, many more people are buying the product that does make it into stores after realizing that being stuck at home is the perfect excuse to tackle all those DIY projects they’ve been meaning to get done.
Needless to say, there is a shortage of supplies, and regardless of the reason for the shortage, this has meant a significant increase in the price of supplies. While a piece of exterior sheeting cost about $7 in March, now it’s closer to $23. Stud prices have increased from $2.50 apiece to $7. We’re looking at double, triple, and even quadruple pricing on some of the building materials! We’re also seeing a slow down in the availability of those things, and so it’s taking us longer to get them.
So to get to the original question: how does all of this impact your pricing? Well, just right off the bat: there is in most situations a 25% price increase over the same time last year to do the same project. And as much as we hate that, our hands are tied!
When the borders open back up, are we going to get more materials? Absolutely. Is there going to be a major incentive for those manufacturers to actually bring pricing down and make it easier on us, the contractors, and you, the homeowners? Unfortunately, not right away. And while prices will eventually come back down, they’ll probably continue to climb for quite a bit longer before they get back to pre-COVID prices.
However, if we can make a bold assertion, even with these prices, if you’ve been thinking about doing the addition or renovation in the next five to ten years, now is actually the best time you could possibly start that addition project you’ve been considering. Of course, you may be thinking “if prices are high, why are you saying that this may be the best time to commit to that addition or renovation?”
The simple truth is, we don’t know what the future holds. But if past history has shown us anything (like prices during the Gulf War and afterwards), it took prices almost ten years to go back to pre-Gulf War prices. From our experience in the industry as the war geared up, we saw prices continue to climb for many years.
So if you’ve been thinking about it, now is the best time because prices are only going to get higher from here on out. Of course, you can always wait until prices come back down… but that might be another ten years before the numbers reach the low they were at in March of this year. Can you live with that too small-kitchen, or one bathroom for the whole family for ten more years?
All that said, we do hope that this was a helpful post that addressed the concerns you might be having right now about your home projects. As always, we hope to be a resource here at Valiant Home Additions, so we’d love to answer any questions you might have. Just reach out via our contact page today!