Prices for wood to build and renovate houses have as much as doubled over the past six months, increasing costs for consumers but boosting Maine’s softwood sales and signaling a turnaround in that segment of the forestry market, industry experts say.
A number of factors drove up the price of wood. They include pent-up demand for new houses or additions following the recession, forest fires last year in western Canada that destroyed prime forests and shuttered mills for up to two months, a trade dispute between the United States and Canada, and hurricanes and other weather that created demand for repairs and new homes. A shortage of railcars and trucks also made it more difficult to transport lumber.
That all translates into a tight supply of wood. To meet demand, mills in the state are boosting production, adding jobs and raising wages. Some lumber yards are giving materials quotes to builders that are valid for only one week because prices are fluctuating so dramatically. And builders are seeing strong demand from home buyers, who will have to pay an extra $7,000 to $15,000 for a new house.
The turnaround in the softwood market started in 2016, said David Flanagan, president of Viking Lumber in Belfast. He attributed it to consumers feeling more comfortable financially about building a new house, addition, deck or kitchen after the recession.
“Two years ago, framing lumber for houses was the same price as it was 16 years ago,” Flanagan said. “Forest products have been way overdue for an inflationary adjustment. The market was depressed for a lot of reasons, including a lack of demand and an oversupply.” But in the past couple of years, “prices of lumber have gone up faster than I’ve ever seen them,” Flanagan said.