Page 8 - Builder Brief February 2022

2022 PRESIDENT
LABOR AND MATERIAL SHORTAGES CONTINUE TO EFFECT RESIDENTIAL CONSTRUCTION AND REMODELING
Just when we thought that we had seen the last steep increase in lumber prices, Builders and Remodelers just got hit with another wave of price increases. With these new increases, homebuyers are now paying an additional $18,600 for a new home, according to the National Association of Home Builders' (NAHB) latest report published on January 7, 2022. The price increases are due to a doubling of tariffs on Canadian lumber imports, the ongoing supply chain disruptions, and an unusually strong summer wildfire season.
NAHB has constantly communicated with the White House and our elected officials, urging them to restart negotiations with Canada on a new softwood lumber agreement that would end tariffs. The supply chain disruption is partly due to the sawmill industry not being able to keep up domestic production with the new home construction gains. The sawmill production slow down came in mid-2020 when they drastically curtailed production due to COVID, thinking that housing would stall when demand remained strong and grew as the pandemic lingered.
The sawmill industry also cites labor challenges as a limiting factor to getting production back up to where it needs to be. With insufficient output in part of 2020 and all of 2021, these materials shortages have played a significant role in the dramatic increase in lumber prices.
According to Random Lengths, as of December 29, the price of framing lumber topped $1,000 per thousand board feet. This price reflects a 167% increase since late August 2021. The slow reaction by sawmills, combined with the massive uptick in demand from do-it-yourselfers and big-box retailers during the pandemic, resulted in lumber prices hitting a record- shattering $1,500 per thousand board feet last May 2021 with a gradual decline in prices seen through late August.
Think about where softwood lumber is used in building a new home - structural framing, which includes beams, joists, headers, rafters, and trusses as well as in sheathing, flooring/underlayment, interior wall, and ceiling finishing, cabinets, doors, windows, roofing, siding, soffit, and fascia, along with exterior features such as garages, porches, decks, railing, fences and landscape walls!
The lumber price hikes disrupt the housing market and harm home affordability. The Greater San Antonio Builders Association (GSABA) is working with the NAHB leadership team to get accurate information into our elected officials' hands and urge them to increase domestic lumber production. Wewillcontinuetokeepyouinformedofoureffortsonyour behalf.
MIKE SOWRY
The labor market is also playing a part in the disruption of the housing market. I talk to Builders every day that share stories of half of the framing crew coming to work or sharing that several closings were delayed because flooring companies didn't have the qualified staff to lay carpet and flooring properly. They had the materials; they just didn't have the labor.
As we all know, immigrant workers remain a vital source of labor to the construction industry. In Texas and California, 40 percent of the construction workforce is made up of foreign- born labor. The jobs most in-demand and in need of skilled laborers are drywall/ceiling tile installers, painters, roofers, cement masons, followed by construction laborers.
Our supplier and vendor members are experiencing the same labor shortages in their companies, which adds to the slowdown in deliveries and installations. We are working to be part of the solution. The new career network portal for our website is now available so you can post open positions within your company. We will be teaming up with the City of San Antonio and the SA: Ready to Work program to bring qualified candidates to our website. We will also be doubling our efforts with our Student Chapters at St. Philip's College and the University of Texas at San Antonio, getting them involved. Thank you to all of you who have already connected us with some local veterans organizations.
Sincerely,
8 FEBRUARY 2022 | GREATER SAN ANTONIO BUILDERS ASSOCIATION