The price of residential construction products (as a group) from January to July of this year rose at a rate more than double that of all products, according to an analysis of the latest Bureau of Labor Statistics Producer Price Index (PPI) data by the National Association of Home Builders. During those seven months, steel mill-produced products saw the most extreme increases, rising more than 80%—considerably more than the 11% increase the product category experienced in 2020—but several categories saw dramatic increases.
10 Most Significant Price Increases YTD
As NAHB Economist David Logan points out in his recent Eye On Housing post, despite declining lumber prices—which as of April were reportedly responsible for having driven up the average price of a new single-family home by nearly $36,000—residential construction products are being particularly hobbled by current market conditions. The 10 most impacted residential construction products have all seen year-to-date price increases exceeding 30%. Those include: steel mill products, building paper and building board mill products, asphalt, plastic water pipe, fertilizer materials, laminated veneer lumber, thermoplastic resins and plastic materials, structural metal joists and concrete reinforcing bars, wood window and door frames, and copper pipe and tube.
But while year to date steel mill products like metal roofing systems represent the most significant rise in price—and homeowners have been affected, according to manufacturer Sheffield Metals International, which provides metal sheet and coil products to roofing contractors—the rate of increase has slowed compared to other residential construction products.
Between April and July, the price for steel mill products rose about 20% while prices for both laminated veneer lumber and building paper and board mill products jumped over 30%. Overall, 31 products rose more than 10% during that three-month period.
Some building products have avoided the more pronounced price spikes, such as water heaters, which actually saw a decline in price last year. All 10 products listed below, in fact, experienced virtually no fluctuation in price in 2020. Still, as economist Logan pointed out in his recent post, monthly increases in 2021 for those particular products have been “substantial.” Water heaters, for instance, are averaging a monthly price increase of 3.1%.
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