July 5, 2022

Material Pricing May Be Dropping, But Project Pricing Is Still Climbing. Here’s Why.

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Who remembers when pricing for lumber, steel, and basically every construction material skyrocketed in 2021? I remember, painfully, because my fence was blown off by the wind and I paid a pretty penny to be able to replace it myself. Back in July, and even more recently, we’ve seen pricing drop back down, not nearly back to normal, but low enough where it brought hope to many of us that finally, our dream remodeling project would be attainable. Well, the industry just gave us a big “SIKE”!

With our market research as well as from our personal experience, labor is experiencing a hike in price. The reasoning behind this can be pinned to the ongoing pandemic, however, we believe it’s from the lack of people experienced in the trade and a higher demand for laborers.

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We’ve had multiple carpenter positions open for the past couple of months (FYI, still open, if you’d like to apply, click here), and the industry is competitive. Laborers are demanding higher wages since they’re aware of the hole in the industry, and as a remodeling company (and others alike), we have to succeed. It’s not a bad thing, we want to pay people what they’re worth, however, that means our prices have to jump up as well.

We’re not the only ones seeing this. Daniel Pomfrett, VP at Cumming Management Group, shared with Obando that with material prices now waning, labor is the next thing the industry has to look out for. According to Pomfrett: "If you take lumber markets, for example, even though lumber prices may come down, there are still going to be price increases [on the project] as a whole because labor skillset shortages are out there." He added, "as people come back with more construction projects, we're going to have more work coming than we have for labor."

I wish I could throw in a conclusion to this, however, that’s not possible. This is an ongoing thing, as far as we know, it will continue throughout 2022. The best advice I can give you is the following:

  • If you’re a laborer or a carpenter, reach out to us. We could definitely use you.
  • If you’re looking to start a remodeling project, I highly suggest you reach out to us and seal your estimate before pricing rises any further. Our estimates are good for 30 days, and projects are backed up anywhere between 2-6 months, so it’s best to start soon.

If you have any questions, comments, or concerns, feel free to reach out to us. Our number is 651.493.3012, or feel free to email marketing@homestead-llc.com, and I’ll be glad to help you out!