Why Can’t Builders Build More Homes?

New home builders built 927k new SFRs in 2021 and they built another 319k new multi-family apartments for total completions of 1.246 million. But 1.899 million new permits were issued last year. There is an incredibly strong demand for housing as witnessed by the number of new permits issued, but completions are over 600k units lower due to all the supply constraints. Housing Wire featured a story titled, “It’s Crazy: Homebuilders big and small struggle to finish projects.”

    

• Lumber prices have been incredibly volatile and are now back up to $1200 after peaking at nearly $1700 last year; but up from its low of $454 in the last year.

•  Lumber mills still have not increased production due to labor shortages.     
•  Gypsum, which is used for drywall, has seen prices rise by 21% in the last year and no new production is expected this year.      
•  Roofing materials are in short supply and not expected to increase this year.        
• Garage doors are in such short supply that the NY Times did a story on this in the last 2 weeks.        
• Window orders now take 12 to 14 weeks.