Increasing Lumber Prices: How Will This Affect Your Home Renovation?
North American lumber prices are soaring higher than ever before, boosting the costs of home renovations and other contracting work across Canada. Ian Dunn, the president of Ontario Forest Industries Association, claims the pandemic has largely influenced the jump in prices.
Supply has gone down due to the limitation of workers inside of wood mills. Even sawmills were completely closed for a period of time when the pandemic started. The decrease in supply increases the demand and inevitably drives up the price. Dunn estimates the price of lumber to have gone up roughly 170 per cent in the last six months.
Not only has supply affected the demand, but since most homeowners have been spending more time at home, there has been a bigger demand for home renovations. A survey conducted by TD bank back in December found that renovations in Canada is up nearly 40%.
With supply being low and demand being high, mills are doing their best to catch up. However, they cannot change forest management planning as they have to keep forests sustainable. That means the prices of lumber will not drop anytime soon.
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