At AV Homes in Arizona, we will be instituting a series of price increases in the coming weeks, and we’d like you to understand why. The cost of our homes is ultimately the result of a combination of other costs, including labor and materials, and our prices reflect changes in the market.
Overall, 2017 has been an unusual year for rising costs. The first quarter of 2017 saw significant increases in the prices of softwood lumber, gypsum, ready-mix concrete and OSB, according to the Producer Price Index released in April.* That is not a typical trend.
Softwood lumber prices alone rose 7.2% during the first three months of this year, and are up almost 13% since that same period last year. These hikes are largely due to the ongoing lumber trade dispute between the U.S. and Canada. Imported Canadian softwood lumber (Spruce/Pine/Fir) is used as framing lumber, so builders all over the U.S. are experiencing this. The cost of composite structural materials like plywood and OSB has gone up, as well, as elevated demand from builders has encouraged mills to hike their prices accordingly. Uncertainty as it regards the resolution of the U.S. / Canada trade agreement will continue to inject instability into the lumber trade, resulting in rising prices, uncertain tariff rates, volume limits and shortages. **
At AV Homes, we build our homes as economically as possible, using efficient building processes and highly skilled experts. Know that we increase our prices only as made necessary by outside factors. And we look forward to working with you to build the home of your dreams.
* Source: NAHB Now, “Cost of Building Materials is on the Rise”, April 14, 2017.
** Source: NAHB Eye on Housing, “Lumber Prices Rise to Start 2017”, March 3, 2017.