The slowdown in the U.S. housing market is causing lumber prices to plummet. Nationally, lumber prices fell 12% the week ending June 3 and are down 47% year-to-date, representing a 65% decline from 2021’s record high of $1,733 per thousand board feet, according to the National Association of Home Builders (NAHB). That could be good news for prospective homebuyers, who have watched lumber prices skyrocket during the pandemic, adding more than $18,600 to the average price of a new single-family home in the past year.
IN THE TWIN CITIES REGION, FOR THE WEEK ENDING JUNE 4:
- New Listings decreased 2.1% to 1,772
- Pending Sales decreased 13.7% to 1,077
- Inventory increased 7.9% to 6,968
FOR THE MONTH OF APRIL:
- Median Sales Price increased 10.0% to $370,000
- Days on Market decreased 9.7% to 28
- Percent of Original List Price Received increased 0.5% to 103.8%
- Months Supply of Homes For Sale increased 9.1% to 1.2
All comparisons are to 2021
June 9, 2022
After little movement the last few weeks, mortgage rates rose again on the back of increased economic activity and incoming inflation data. The housing market is incredibly rate-sensitive, so as mortgage rates increase suddenly, demand again is pulling back. The material decline in purchase activity, combined with the rising supply of homes for sale, will cause a deceleration in price growth to more normal levels, providing some relief for buyers still interested in purchasing a home.
Information provided by Freddie Mac.