Soaring lumber prices add to the cost of a new home • Hacker News Board

Re: Soaring lumber prices add to the cost of a new home

#91

Post by kokanator » Fri, Apr 30, 2021, 8:33 PM UTC

omgwtfbyobbq wrote: post #27

From what I've heard, this is mostly a function of... 1) Lumber mills shutting down because of weak demand and tariffs. https://www.woodworkingnetwork.com/news/woodworking-industry... 2) Curtailment of remaining production because of coronavirus https://www.woodworkingnetwork.com/news/canadian-news/corona... 3) The housing market going a little nutty https://www.vox.com/22264268/covid-19-housing-insecurity-hou... 4)…

Does it feel like we have squeezed a critical part of our infrastructure here allowing it to close down or go bankrupt? This could have lasting affects for decades.

Re: Soaring lumber prices add to the cost of a new home

#92

Post by vkou » Fri, Apr 30, 2021, 8:47 PM UTC

kokanator wrote: post #89

vkou wrote: post #7

Earlier quoted context omitted.

Marginally profitable mills shut down/go bankrupt when tariffs are introduced, and unlike AWS instances cannot be spun up on demand.

Does it feel like we have squeezed a critical part of our infrastructure here allowing it to go bankrupt? This could have lasting affects for decades.

Canadian lumber has always been a political football for American politicians to kick around whenever they needed to score some points, so we're used to this sort of thing.

Like any resource extraction industry, it goes boom, it goes bust, it recovers.

Re: Soaring lumber prices add to the cost of a new home

#93

Post by maxerickson » Fri, Apr 30, 2021, 8:49 PM UTC

croutonwagon wrote: post #83

andrewmcwatters wrote: post #4

I don't know what the risk calculus is for these home developers, but I do know that in particular areas of the US, you just straight up cannot afford a home anymore on median income (or even the top 20%ers looking for fair pricing!). I anticipate that mortgages will continue to push past 30 years into a strange 45-year+ territory, and we'll begin to see Japan-like multi-generational mortgages. Actually, in reality t…

The Federal government has a TON of subsidies for first time buyes and even more for veterans. The issue is part land scarcity driving up the cost of land and part the transition of our economy out of production and into consumerism. Building has never been cheaper, and even quality has improved, including working through some pretty bad materials changes (like PEX plumbing, or chinese drywall). We no longer really d…

I am under the impression that the change to PEX was good? It sure was adopted fast.

Do you mean it was a significant change?

Re: Soaring lumber prices add to the cost of a new home

#94

Post by epicureanideal » Fri, Apr 30, 2021, 8:50 PM UTC

almost_usual wrote: post #60

ixacto wrote: post #39

Earlier quoted context omitted.

This is the real problem IMO. We need more dense condos like Chicago, where the median condo price is 268k versus other large cities where it is almost double that. This is just people being taking advantage of their housing...investment/tax shelter/savings plan that is bidding the price up. Look at something like this zero red flags that I can see for $219k that is much cheaper than in most other large cities, housi…

Condo prices have gone down in the Bay Area since COVID. The problem is everyone wants a SFH suburban lifestyle in the Peninsula, Marin, or East Bay hills. That’s a luxury and you’re going to pay a premium for it.

But are still EXTREMELY expensive relative to most of the US, not because of materials costs.

Re: Soaring lumber prices add to the cost of a new home

#95

Post by qeternity » Fri, Apr 30, 2021, 8:53 PM UTC

Morvan wrote: post #78

BitwiseFool wrote: post #6

The universe is determined to keep as many millennials from buying homes as it can.

>The universe That's a funny way to spell government appointed central bankers who fix the price of money.

You cannot blame CBs. I despise the current monetary policy as much as the next person but this is a function of society. We have stopped believing in “no pain no gain”. We think that everyone should be gifted a painless utopian existence in which nothing bad ever happens.

Darwinian forces always win.

Re: Soaring lumber prices add to the cost of a new home

#96

Post by [deleted] » Fri, Apr 30, 2021, 9:03 PM UTC

croutonwagon wrote: post #83

andrewmcwatters wrote: post #4

I don't know what the risk calculus is for these home developers, but I do know that in particular areas of the US, you just straight up cannot afford a home anymore on median income (or even the top 20%ers looking for fair pricing!). I anticipate that mortgages will continue to push past 30 years into a strange 45-year+ territory, and we'll begin to see Japan-like multi-generational mortgages. Actually, in reality t…

The Federal government has a TON of subsidies for first time buyes and even more for veterans. The issue is part land scarcity driving up the cost of land and part the transition of our economy out of production and into consumerism. Building has never been cheaper, and even quality has improved, including working through some pretty bad materials changes (like PEX plumbing, or chinese drywall). We no longer really d…

[deleted]

Re: Soaring lumber prices add to the cost of a new home

#97

Post by ineedasername » Fri, Apr 30, 2021, 9:04 PM UTC

As the article notes, much lumber production shut down believing COVID would significantly impact demand, but that was really not the case except for a very short period of time.

In my area in particular, I live outside of a city hit hard by COVID, and that had lots of workers who could transition to WFH. The combination means that city dwellers have flocked to the local suburbs in massive quantities, often buying up the cheapest houses & either immediately expanding them or simply knocking them down completely to rebuild from scratch. As a result, not only is it difficult to find local contractors available for even minor home improvements, local property values have spiked as much as 30% over the last 14 months. This has been greatly assisted by mortgage interest rates that as incredibly low-- I just refinanced and saved about 20%/month on my mortgage and an overall $50,000 saving over the life of the loan.

Re: Soaring lumber prices add to the cost of a new home

#98

Post by idiotsecant » Fri, Apr 30, 2021, 9:04 PM UTC

qeternity wrote: post #95

Morvan wrote: post #78

Earlier quoted context omitted.

>The universe That's a funny way to spell government appointed central bankers who fix the price of money.

You cannot blame CBs. I despise the current monetary policy as much as the next person but this is a function of society. We have stopped believing in “no pain no gain”. We think that everyone should be gifted a painless utopian existence in which nothing bad ever happens. Darwinian forces always win.

I'm not sure you fully understand the experience of the typical young adult in this country right now. I'd say the phrase 'all pain no gain' is closer to reality. Compared with even the last generation (who had it pretty bad compared to the generation before them) the opportunity to have a reasonable standard of living is greatly reduced.

Re: Soaring lumber prices add to the cost of a new home

#99

Post by lightelement » Fri, Apr 30, 2021, 9:07 PM UTC

adrr wrote: post #30

Has anyone looked at the cost of food or gas lately? Interest rates need to go up. It is beyond stupid that I was able to refinance my house at 1.75% on 15 year loan in December. My previous loan was 4% on a 30 which already was extremely low. It’s giving people free money who don’t need it. Side effect is the inflation that punishes the poor even more.

Does inflation punish the poor more? It punishes people with savings, and people with savings are generally not poor. Inflation also helps anyone with a loan (because that loan just got "smaller"), and people with a lot of debt are generally poor as well.

Re: Soaring lumber prices add to the cost of a new home

#100

Post by idiotsecant » Fri, Apr 30, 2021, 9:09 PM UTC

margalabargala wrote: post #79

spamizbad wrote: post #25

Earlier quoted context omitted.

My understanding is the Canadian government put limits last year on how much timber could be cut. So their prices were going up no matter what.

Mills are the issue, not timber. There's an excess of raw timber right now, all of the wood from the wildfires in the PNW last year is being salvaged currently.

it's not just firewood supplies (not sure how much that impacts the market, and the PNW has a more or less permanent fire season each year now anyhow) - The market has been glutted with raw timber for a decade. There has been a huge oversupply for quite a while. This continues to today - just because lumber mills are making money hand over fist doesn't mean raw timber producers are.