Georgetown | July 2021

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High cost, materials shortage cause barriers to some local development BY BROOKE SJOBERG

cost of 1,000 board feet of lumber increased from $365 in May 2020 to $1,673 this May. Billington said his company had never seen this kind of volatility in the cost of building materials during the company’s 30-year history. Billington said the company has not had to delay projects specically due to the unavailability of lumber, but it has had to adjust the contract price for homes due to the rapid change in cost of materials. Lumber is not the only type of building supply that is scarcely available, he said. “It’s across the board—appliances, HVAC, everything is on [backorder],” Billington said. Varying vulnerabilities Another homebuilder that works in the area, Verde Builders Custom Homes, has not experienced dicul- ties with material unavailability. Pres- ident Daniel Reeves told Community Impact Newspaper his business model is not as exposed to volatility as some others because the company builds specialty homes. “Obviously, we have to adjust our budgets, but the key for builders is to communicate with their clients and add an adequate contingency for these cost increases,” Reeves said. of building a single-family home and $13,000 to the price of a multifamily home since April 2020. $36K Increasing costs of materials have added an extra $36,000 to the average cost

a reduction in the number of truck drivers and other logistic challenges, according to a study from the Texas A&M Forest Service. Local ocials, builders and other stakeholders from the Williamson County area said they are feeling the eects of this trend. “We’ve got this real volatility in lumber and concrete, which are like a hurricane, and you’ve got these big waves on the surface, chopping everything up,” said Keith Billington, a new-home adviser with Silverton Custom Homes, an Austin-based builder that constructs homes in the Williamson County area. “But what you don’t see is that [the] tide of the ocean underneath just continues to rise, and it keeps rising.” Skyrocketing costs Throughout the homebuilder industry, NAHB data shows serious shortages have been noted in appli- ances; lumber; windows; doors; ply- wood; and oriented strand board, which is similar to particle board. The cost of lumber by board feet, which is 1 square foot and 1 inch thick, has increased by 358%, according to Trading Economics, an online eco- nomic data platform that provides historical data and forecasts. The

according to the National Association of Home Builders. Increasing costs of materials have added an extra $36,000 to the aver- age cost of building a single-family home and $13,000 to the price of a multifamily home since April 2020, according to data from the NAHB. As building becomes less aordable, new construction of homes has dropped almost 10% in that time. Additional delays were caused by

The rising cost of building mate- rials is causing some uncertainty in homebuilding and other construction projects, but that is not delaying all development in Williamson County. Lumber and other building material shortages can be traced to the COVID- 19 pandemic, when mills and other production facilities were limited by closures and the number of people allowed in a facility at a given time,

The cost of building nationally has risen considerably over the past year due to COVID-19-related closures and increased demand. BUILDING THE COST OF

LUMBER

The cost of lumber reached an all-time high of $1,673 per thousand board feet May 7. This is up 358% from $365 a year prior.

CONCRETE The cost of concrete rose by an annualized 2.9% to $128 per ton from 2016.

BRICK

The cost of brick production increased by 3.14% , which means the same amount of brick that could be made for $100 in 2020 cost $103.14 to make in 2021.

SOURCE: NATIONAL ASSOCIATION OF HOME BUILDERSCOMMUNITY IMPACT NEWSPAPER

SOURCES: U.S. BUREAU OF LABOR STATISTICS, TRADING ECONOMICSCOMMUNITY IMPACT NEWSPAPER

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