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Cost of construction skyrocketing

JLC-1

I just saw this on twitter, and resonated with all the conversations we are having right now with our contractors about not only price but availability of materials like lumber or tile. What's your experience? We have been trying to tell our clients to wait 6 months to see what happens next, but it's all just a guess.

 
Apr 28, 21 3:21 pm
proto

just had two GC's price a 650sf dormer addition w/ a bathroom

should have been in the $150k range

GC#1: $265k

GC#2: $279k

the client hasn't seen those numbers yet, but they are going to shit themselves first & then they are going to not do the proposed work & wonder why we led them down this path...

Apr 28, 21 3:32 pm  · 
4  · 
JLC-1

it's insane, we did fixed fee for this repeated client, and the house is already 50% above initial estimates. should we stop building for a while?

Apr 28, 21 3:34 pm  · 
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proto

Material pricing will come down a little as production streams get ramped back up. But i think demand for projects is only going to keep growing because people/businesses have been sitting on their hands during the shutdown and want to get rolling again

the GCs we work with seem to be booked out months & some into next year

Apr 28, 21 3:43 pm  · 
3  · 
tduds

I haven't seen much impact on my professional projects, but we pushed back our plan to rebuild a deck + pergola on our house until next year. Prices are absurd right now.

Apr 28, 21 3:47 pm  · 
1  · 
randomised

I'm glad materials are so expensive, they should be...makes people think twice (hopefully) about destroying the planet even further. Reuse and recycle is the way to go! https://madaster.com

Apr 28, 21 3:57 pm  · 
2  · 
JLC-1

I'm glad you live in heaven, here on earth that stuff isn't even available.

Apr 28, 21 4:00 pm  · 
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tduds

If only the price of materials correlated with their environmental impact you might have a point.

Apr 28, 21 4:02 pm  · 
3  · 
randomised

they soon will be tduds, 

it's the only way...the polluter will pay

Apr 28, 21 4:17 pm  · 
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bowling_ball

yeah, that huge polluter known as lumber. Right. GTFOH.

Apr 28, 21 4:35 pm  · 
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tduds

Pick a tense, rando.

Apr 28, 21 4:41 pm  · 
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randomised

We can and should already reuse and recycle, so past, present and future tense...just look at what is thrown in dumpsters at building sites, it is just vulgar. Glad people will have to be more conscious about how and what they want to build. Even lumber is a huge polluter when it needs to be cut down, transported, transformed and installed on site unnecessarily. The most sustainable project is the one not built at all. Building to generate a profit instead of fulfilling a real and urgent need is what got us in this mess.

Apr 29, 21 5:12 am  · 
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tduds

I think you missed what I was getting at.

Apr 29, 21 11:01 am  · 
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JLC-1

sure, nothing to do with bankers and colonialists exploiting the southern hemisphere for 500 years, it's all the architects' and builders' fault.

Apr 29, 21 11:01 am  · 
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x-jla

Random, I’ve been trying to push gravel patios as an alternative to cut stone or concrete for aesthetics and environmental reasons. It’s been an easier sell lately than ever before. 1.50 psf vs 15$ psf. Sure!

Apr 29, 21 11:29 am  · 
1  · 
JLC-1

let's recycle some pets https://www.vox.com/the-highlight/22375369/comic-pets-climate-change-environment

Apr 29, 21 4:05 pm  · 
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randomised

I didn't miss it tduds, I might have just added some wishful thinking to the mix.

Apr 29, 21 7:04 pm  · 
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randomised

"sure, nothing to do with bankers and colonialists exploiting the southern hemisphere for 500 years, it's all the architects' and builders' fault." 

Be the change you want to see in the world

Apr 29, 21 7:06 pm  · 
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Wood Guy

I have a new 12' x 24' screened porch over a basement, an addition to an existing house with a few related items. I figured $80-100K. Nope: $180K. It's insane. 

Apr 28, 21 4:00 pm  · 
2  · 
gibbost

Certainly, material costs are way high right now.  But I also think that contractors and subs are using that to hide behind some unsavory price-gouging.  Here in the midwest, we never really saw much slowdown in construction activity last year.  Everyone is busy.  As such, most contractors have projects logged for 12-18 months out.  If you're lucky enough to get a bid, it will be astronomically high because they don't actually need the work--and if they are awarded the project, it's just gravy on top.

Apr 28, 21 4:09 pm  · 
5  · 
archi_dude

That's actually not what's happening at all. There is an extreme shortage of labor due to the massive layoffs 10 years ago and a wave of retirement. Couple that with the extended unemployment that gives workers more money than when they were working. A lot of the skilled trades that are in high demand are flaiming COVID risks, taking the unemployment than hiring themselves out as a cash hourly skilled worker under the table. So theres that, next is the extreme material shortages. It's not a smokescreen. Prices are rising so high so fast that theft is a massive issue on sites right now because subs who did not lock in prices with vendors earlier are now screwed and possibly could default on work becuase they cant cover all their jobs and did not anticipate a random 30- 40 even 100% increase in basic materials in less than a year.

Apr 28, 21 4:26 pm  · 
3  · 
x-jla

It’s all of the above. Materials, labor shortages, and increasing prices because of high demand/low desperation.

Apr 29, 21 7:28 pm  · 
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thisisnotmyname

Is it at the point that metal studs would be a reasonable alternative to wood framing?  At the lumberyard by us, the wood and metal studs are just about the same price.

Apr 28, 21 4:12 pm  · 
1  · 
gibbost

For projects that will allow it, I've started showing both partition types (wood vs. steel) and letting the contractor verify which will be cheaper. It's been my experience lately that metal studs are cheaper, but harder to get a hold of.

Apr 28, 21 4:17 pm  · 
1  · 
archi_dude

10 week lead time currently on metal studs. So essentially right up there with AAON units.....

Apr 28, 21 4:20 pm  · 
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joseffischer

We've been doing this for almost a year now, so far they've all gone metal stud and the end product on projects wrapping up has vastly improved... walls are straight again... I've been building up a presentation to push to stay metal stud when/if things "go back to normal" on quality alone

Apr 29, 21 1:59 pm  · 
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gibbost

I am consistently seeing projects come-in 20-30% higher than proformas built just a year ago.  It's hard to watch an Owner make all the right steps, just to see a project come in much higher than the anticipated loan and investment they were prepared to make.

Apr 28, 21 4:14 pm  · 
1  · 

I've been dragging my feet getting quotes for material to build the deck I was posting about a while back. Dreading the sticker shock. 

We are looking at replacing our windows and one contractor said they are scheduling 7 months out right now. That was just when I called to see about hours for their showroom. We haven't even discussed getting a quote yet.

Apr 28, 21 4:20 pm  · 
2  · 

On twitter my friend Lora posted that her residential windows are on a 16 week lead time and 25% higher price than expected.

Apr 29, 21 1:16 pm  · 
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When we went into the showroom and talked to them, they also said that usually window manufacturers raise their prices at the beginning of the year and they stay there until the next year. This year they've got manufacturers telling them they are raising prices in June and to be prepared for it.

Apr 30, 21 1:19 pm  · 
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bowling_ball

Got quotes for a big reno at my house, this was last June. Budgeted $75k. Quotes came in $120k to $190k.  It's only gotten worse.


Locally, if you can find any, 3/8" OSB is advertised for $55/sheet. Prior to the pandemic it was anywhere from $8 to $11. I've seen as high as $70/sheet. FOR OSB.

Apr 28, 21 4:40 pm  · 
2  · 
joseffischer

was at the Homedepot the other day, they hadn't even bothered removing the stickers. Plywood had like 8 stickers on top of eachother with $5-10 increases each time

Apr 29, 21 2:01 pm  · 
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Time to peel off some stickers and get the original price.

Apr 30, 21 1:34 pm  · 
1  · 
Non Sequitur

I just picked up 2 treated 2x8 (12' long) for 30 loonies each just this past weekend.  

Apr 28, 21 4:48 pm  · 
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Lumber prices are nuts and as an architect that mainly does multi-family housing.....causing me nightmares.

Apr 28, 21 5:16 pm  · 
3  · 

Just finished up a core and shell, wood framed retail building.  2,800 sf with mostly metal panel and a bit of face brick.  $600,000

Suppliers are saying that lumber prices should be returning to normal prices in the next 4 months or so. 

Apr 28, 21 5:36 pm  · 
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Bench

Curious how they're seeing that? (Not a challenge, just seems oddly specific, and much quicker than I expected ...)

Apr 29, 21 7:41 am  · 
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bowling_ball

Your suppliers are dreaming. Prices will never fully come back down to 2019 levels, but they'll get sort of close by 2024 I'm fairly confident. There's going to be a two year backlog of construction for SFH, starting this summer. Not a chance.

Apr 29, 21 2:30 pm  · 
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I didn't say 2019 prices. In my area we started seeing price increases 6 months ago. The really high prices started two months ago for us. Prices are supposed to return to 2020 numbers for us around August or so. 

 I was told the reason for the increase in cost in my area was due to three issues. 

 1. A mill in Canada closed. 

 2. COVID decreased output. 

3. Housing construction never slowed down during COVID

Apr 29, 21 4:14 pm  · 
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whistler

All starts with the price of sheet of Plywood:

2019 $34.00

2021 $110.00

WTF!


Apr 28, 21 6:06 pm  · 
3  · 
gibbost

This is in no way trying to high jack this thread. I assume plywood to be a high-demand item these days. What is not going to construction is being used to board-up and fortify.

Apr 28, 21 6:24 pm  · 
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Bench

"This is in no way trying to high jack this thread."

lol k bud

Apr 29, 21 4:38 pm  · 
1  · 

Board up for civil unrest is small compared to hurricane board up when the season starts in August we will probably see a spike in lumber cost again if we have a busy storm season.

Apr 29, 21 5:27 pm  · 
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I can't claim this as my own, and I'm not sure who said it first as I've been seeing it from multiple people on the socials (otherwise I'd credit them), but ...

The driver was going to go through insurance, but sold the plywood and bought a new car instead.

Apr 28, 21 6:34 pm  · 
5  · 
Jaetten

Was there a discount for the damaged corner to the ply on the right?

Apr 29, 21 6:51 am  · 
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archi_dude

When we tear down our plywood temp barrier where the curtain wall is going in the next few weeks, I shall retire...401ks they said.

Apr 28, 21 8:22 pm  · 
3  · 
zonker

Ta get a little extra cash, think I'll head over to one of my job sites, collect scraps to sell to the plywood mill 

Apr 28, 21 9:02 pm  · 
1  · 
w. architect

I find a correlation between lumber costs and ammo! The hope for both is that it will come down in future, shall we all hold hands and sing now?


Apr 29, 21 10:44 am  · 
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Non Sequitur

Bullets should cost 50k per round for civilian use.

Apr 29, 21 10:48 am  · 
3  · 
x-jla

Chris rock had a funny bit about that

Apr 29, 21 11:25 am  · 
1  · 
Non Sequitur

^yes, but he said 5k per. I adjusted.

Apr 29, 21 11:41 am  · 
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Ah the old bullet debate. To horde or not to horde. :s

Apr 29, 21 11:56 am  · 
1  · 
archi_dude

Or you could just have a background check.

Apr 30, 21 12:54 pm  · 
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x-jla

material costs are up a lot.  I am paying 20% more for natural stone products, plants, lumber, and even labor.  The price isn’t the problem though, waiting for back orders is the problem.  Supply and demand.  I’ve been busier this year than ever before.  Home prices are up, and people are in good position with their equity, traveling less, going out less, so they feel comfortable building that new pool, spending 150k on a totally new landscape, etc.  

Apr 29, 21 11:21 am  · 
1  · 
x-jla

I’ve had projects held up for a month waiting for pavers, tile, etc to get back in stock. I miss the days where only tp was scarce.

Apr 29, 21 11:23 am  · 
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curtkram

people are spending the equity in their houses? like they did in 2008? that's not good.

Apr 29, 21 8:25 pm  · 
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x-jla

I’m not sure if they are borrowing against it as much as in 2008, but say you bought a house for 500k that is not worth 800k...if you remodel and invest 100k you are going to be able to recoup that investment when you sell. So they feel comfortable investing in their homes because they are in positive equity.

Apr 30, 21 12:35 pm  · 
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x-jla

I’ve also had clients express that it’s not worth moving and that they just want to fix their home and keep it long term. I think the flipper mentality may be going down. You sell and then what. Everything is so overpriced and inventory is so low that it’s not really worth it. So, kind of a good trend i think.

Apr 30, 21 12:39 pm  · 
2  · 
w. architect

Tp!..the good old times!  

Apr 29, 21 11:30 am  · 
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I'm sure you've all seen this one:


Apr 29, 21 1:20 pm  · 
7  · 
Non Sequitur

I can smell that picture.

Apr 29, 21 1:25 pm  · 
4  · 
b3tadine[sutures]

Why do I want to smack that guy with a 2x?

Apr 29, 21 3:49 pm  · 
1  · 
SneakyPete

He's obviously got wood.

Apr 29, 21 7:16 pm  · 
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proto

@b3ta


Apr 30, 21 1:31 pm  · 
1  · 
zonker

FRT version? thats even more bux

Apr 29, 21 4:25 pm  · 
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