No end in sight to supply shortages
As of May 2022, the leading causes of the increase in building new homes fall into three main categories.
- Demand. There is still high demand for building materials, for both new homes and renovations. Unfortunately, prices have risen to accommodate this demand, and whilst this is a well-known principle of economics, it doesn’t make it any easier to swallow this bitter pill.
- Supply Chain. As we are all aware the global supply chain is still in crisis after two years of COVID and everyone buying more online. This has affected the building industry where a lot of the materials and appliances we use are manufactured overseas to keep building costs as low as possible.
- The Russian war against Ukraine. This has affected the supply of LVLs (Laminated Veneer Lumber), which are used in construction. However, more importantly, it has driven up the price of fuel, and this additional cost has been passed on across all areas of the building industry as the cost to transport materials and workers has risen.