EVANSVILLE, Ind. (WFIE) - As a result of the COVID-19 pandemic, building material production has dramatically decreased.
Eric Feagley, manager of Niehaus Lumber, said he’s had a harder time finding supplies lately, and when he does, they are at a much higher cost.
“Lumber prices have been rising for about the last nine months or better,” Feagley said.
Aside from increased spending, Feagley says the materials themselves have been hard to come by.
“In the past where we might pull from two or three vendors, two or three manufacturers,” he said. “Now, I’m having to shop maybe a dozen.”
With costs continually rising, Feagley said he needs to set his prices higher to accommodate his future expenses.
“The flip side of that is if a customer comes in, he’s at a value based on price tomorrow,” he said.
While those prices balloon from person to person, demand is still extremely high.
Feagley says interest rates on homes and other new builds are very low right now.
So while upfront housing costs are up about 30 percent right now, low interest accrual is canceling it out.
“The end user as far as a mortgage payment goes is going to be in great shape,” he explained. “That’s why I’ve got so much demand, it’s affordable.”
Although the industry has slowed down, even with production halting in some cases, the lumber business has still been going strong through the pandemic.
“It’s a volatile market, but we are shipping product out of here as fast as we ever have,” Feagley said.
He explained that even with general contracting jobs that don’t get affected by interest rates, demand is still there, and business is still strong.
It’s just been bit more expensive.