Prices for lumber soar

SOUTH BEND — If you were planning on working on the house or building a new deck, you might want to add a little bit more to your budget. That's because the price of lumber is up, about 60 percent higher than it was this time last year. According to the National Association of Home Builders, 1,000 board feet cost $208 in April last year. Right now, that price is $342. With such a drastic rise in prices, this is something that could have a major impact on people who make a living with lumber. "The lumber prices are definitely going to have an affect, the higher the lumber is the more I'm going to have to charge," Tim Jackson, Owner of TJ Construction, said. With work still slow for Jackson, he says higher prices could hurt business even more. "If the lumber continues to go up, the prices continue to go up, which slows people down from work again," Jackson said. "Lumber prices have risen for a number of reasons, number one is there is a lack of supply," said Craig Taelman, president of Circle Lumber. Taelman said the lack of supply is from sawmills closing down after the demand for new homes and lumber plummeted. Now that people are starting to buy more wood, lumberyard inventories are going down and prices are going up. "They will keep rising until the mills find it profitable to open and then because of the nature of our economy, supply and demand, the prices will start to decrease once the mills start to open and there is more supply in the market," Taelman said. But that won't happen until new home sales start to go up, a lot. That's something Taelman says isn't going to happen for a few years. For home builders, it's not all bad news where lumber is concerned. "Good thing is though, the last couple of years, we haven't seen a whole lot of increases, so we're still well below where we were during the boom," said Andy Place, sales manager for Place Builders. The price of lumber could increase the price of a new home by 2 to 3 percent, but Place says with the current low interest rates, the cost of lumber shouldn't be a huge factor in new home sales. "Interest rates are still phenomenal, so I don't foresee it being a large issue here in 2010," Place said.