Lumber prices could cripple housing market’s future

Lumber prices could cripple housing market’s future

Lumber prices could cripple housing market’s future
Just when it was thought that the severe shortage of homes for sale in the U.S. was as bad as it gets, in came the pandemic. And while the coronavirus temporarily brought down the U.S. economy and brought the housing market to a grinding halt, it is the ongoing lumber crisis that is topping the list of concerns these days.

In the early days of the pandemic, sawmills both in the U.S. and Canada stopped operations anticipating a housing slump. But now the lumber industry finds itself struggling to keep up. As a result, random-length lumber futures hit a record high last week of $1,615. This is more than seven times higher than April 2020.

The shortage has made lumber such a hot commodity that some builders report having materials stolen from construction sites.

Today, conforming no-point 30-year fixed mortgage rates are averaging 3.0 percent and 15-year rates are near 2.375 percent.

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