Steven Roberts, a home remodeler in the Richmond area, says he has had trouble getting supplies of certain types of oak hardwood flooring since May.
“It is hard to come by,” said Roberts, owner of Virginia Tradition Builders LLC. “It is very common in many older homes that we remodel. It has gone up at least 20% to 25% in cost this year.”
It isn’t just flooring and lumber that have increased in price or been in short supply in the construction market over the last year.
Builders in the Richmond region report supply shortages and higher prices for numerous different products that go into residential and commercial buildings.
It has happened as many Americans — stuck working at home — decided to do home renovation work such as adding a deck or a room for an office or renovating a kitchen or bathroom while demand for new houses also remained strong.
Not just lumber mills, but factories that make materials for plumbing, drainage, windows, siding and electrical wiring were shut down during the early days of the COVID-19 pandemic, leading to gaps in the supply chain.
“The prices are just killing you,” said Tinh Phan, founder of PNC Companies, a Hanover County-based construction contractor, about the rising prices for materials. “The cost of windows and lumber just skyrocketed. We are just going to have to continue to do things to survive.”
Freezing weather in Texas earlier this year contributed to the shortages because many building supplies come from factories in that state.
“There was a water heater shortage in February and March because so many homes in Texas had frozen water heaters,” Roberts said. “There are some paint shortages going on now. Some of the ingredients in paint were stored in warehouses down there and those were ruined.”
Delays and price increases could last into next year, some builders and suppliers say.
Hunter Lansing, CEO of Henrico County-based Lansing Building Products, a major supplier of windows, doors, siding and roofing to the construction market, said he remains optimistic that the construction market will still be strong.
“I think this is going to shake out OK for the building products space,” Lansing said. “I still don’t think we are keeping up with the overall demand for household formation. That underlying factor is really important for our space.”
Finer Homes Inc., a Chesterfield County-based builder of homes, has felt the pressure from lumber costs that jumped as much as 400% during the COVID-19 pandemic, along with supply delays for products such as heat pumps.
“It definitely has been a challenging market,” said Debbie Stoddard, a co-owner and vice president of the company. “The hardest thing we are facing is with some of the shortages. You don’t know when things are going to hit you. Heat pump units have been delayed to our heating contractor on some houses. You have to have the heat in the house to acclimate the hardwood floors. Everything starts getting backed up. That is what everybody has been experiencing.”
“Luckily, our buyers have been very patient,” she said.
Yet, demand for new buildings remains strong, builders say, even as the pandemic has pushed up prices.
“I feel like the demand will continue to be strong,” said Spen Custis, a division president in Virginia for homebuilder Eastwood Homes. “The challenges for us now are more about making sure we can build the homes in a timely manner.”
Some builders get stuck swallowing the increased prices for projects they contracted to do before the pandemic, which hurts their bottom line. Others have put escalation clauses in their building contracts to pass on rising prices to buyers.
Custis, who also is vice president of the Home Building Association of Richmond, said Eastwood Homes has shifted its business model slightly toward selling more pre-built homes so that costs can be controlled. Typically, it would take about six months to build a home, but that time is now being stretched to eight or nine months.
While people can still order a home before building, “we have shifted more to building inventory homes and having them ready at framing and pricing them, mostly to make sure we have materials and the home will be finished for folks,” he said.
“There is definitely no playbook for the things we have run across” in terms of price fluctuations, he said.