210506ind lumber

Anthony Perry, an employee at Arnold’s Lumber in West Kingston, works on a door jamb in the company’s door shop Tuesday morning.

Local building permits required for many home renovation and construction projects show significant increases this April compared to the same time in the last two years, and in spite of a pandemic that recoiled jobs and lifestyles of many people.

“Business is great. People stayed home and used their money on their home. There has been no slowdown since the pandemic started,” said Buz Gileau, manager of the West Kingston-based Arnold Lumber also with outlets in Wakefield, Bristol and Westerly.

According to recently provided numbers on permits issued, three local towns all saw permits jump higher this April compared to last when the state plunged deeper into the grips of the paralyzing pandemic.

Narragansett this year led the way with a 92% increase, followed by South Kingstown with 62% and North Kingstown showed a 39% upward trend over the previous April.

Even when reviewing pre-pandemic numbers for April 2019, last month’s permits exceeded those issued by 32% in Narragansett, 25% in South Kingstown and 12% in North Kingstown.

In April alone the total number of building permits issued in the three towns was nearly 400 for new projects.

Wayne Pimental, Narragansett’s building and zoning official, expressed his surprise at the numbers.


Shortages of Supplies and Lumber

“I must admit, that myself and other building officials around the state anticipated a slowdown in construction when the pandemic hit last year.  Businesses were closing, and it was assumed that building would also be affected,” Pimental said.

“It has been the complete opposite,” he added.

Janelle Blakely Photopoulos, owner of North Kingstown’s Blakeley Interior Design, agreed with Gileau on some people redirecting disposable income to home renovations.

“Many people gained a year of saving money from canceled vacations and less activities out of the house than they would normally do, so they can devote that money to home projects,” she said.

“Even without more disposable income, many also have the option to take out a home equity loan because of the increase in home values,” Photopoulos said.

Jamie Gorman, building official in South Kingstown, said construction and renovation has continued despite other problems in the industry, such as deliveries of lumber and other supplies.

“Our office is experiencing an influx of building permit applications for a wide range of improvements, mostly residential. The increase in volume also continues despite the skyrocketing prices associated with building materials,” Gorman said.

Those ever-changing prices is something that lumber yards and construction supply stores around the state have been struggling to understand and to assist contractors to learn how to navigate.

The National Association of Home Builders says lumber prices have increased more than 200% since April 2020. The “price per thousand board feet” surpassed $1,100 in mid-April, up from less than $500 in June of 2020, the NAHB reported based on data from Random Lengths.

The pandemic-spurred lumber shortage has driven prices sky high — complicating things for the housing market and increasing the costs of construction and other projects. Some involved in the industry have offered forecasts about when the prices could come back down, while others have said it’s unclear, said Arnold Lumber’s Gileau.

One measure of cost volatility is the amount of time a suppliers will hold quoted prices for an item. He said that Arnold’s suppliers have only been holding quotes for 2 days while Arnold has been trying to hold them for seven days.

Before the pandemic, Arnold was able to hold them for months, he said, adding, “What our cost last week is will not be our cost this week.”

For example, he pointed out that one sheet of CDX plywood exterior grade was $22 last week and this week is $48 for that same sheet. The same is happening for roof shingles, spray foam insulation, composite decking and railings.


Reasons for Shortages

The reasons vary from matters related to COVID-19 suppressing manufacturing to high demand putting pressure on transportation companies that cannot be everywhere at once, to weather in Texas disrupting the production of proprietary glues and adhesives used in lumber, such as CDX plywood.

“Every week trucking goes up $500 for same truck, same load, same destination,” he added.

According to some reports, experts and people within the lumber industry have offered varying projections for when prices may come down..

Samuel Burman with Capital Economics, an economic research group, wrote that the firm believes lumber prices will fall over the next 18 months.

Burman told the Charlotte Observer that the demand for lumber is expected to “hold up well for some time” but the firm believes supply should rebound and the price of lumber should sharply decline by the end of 2022 for two reasons.

The firm expects “domestic production to soar” — and says U.S. lumber imports could increase because of fewer restrictions allowing a return to pre-pandemic operations. Included will be an easing in the transportation constraints, he said.

But Michael Goodman, director of specialty products at Sherwood Lumber, told Fortune its unlikely “we ever go back to levels we had prior to this boom” because, “demographically speaking,” the country will need more lumber in the coming years.

Stinson Dean, CEO of Deacon Lumber, made similar predictions to Fortune, saying if “the production factors remain that are limiting log supply, I find it hard to believe we return to historical price ranges.”

In Narragansett, Building Official Pimental made his own predictions.

“Housing prices have increased dramatically, and there is now a lot of equity they are also using for construction projects. With sharp increases in lumber, extreme housing prices, I can’t see this sustaining at the same levels we’ve seen,” he said.

“It’s been a crazy year in all aspects,” the building official added.

Write to Bill Seymour, freelance writer covering news and feature stories, at independent.southcountylife@gmail.com.

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