The Lumber Situation

If you’re one of the millions of Americans who attempted some kind of home improvement or DIY project this past year, or if you’ve started to explore purchasing a Modern-Shed for yourself, you’ve probably bemoaned the delays and price increases in everything from lumber to insulation and windows.

Stacked lumber

So what is UP with the lumber prices? Prices rose by more than 250% in the last year, and over 350% from March 2020’s five-year lows. Why?

At the outset of the pandemic, many mills initially slowed or even halted production. Even when they returned to work, most did so with limited staff and operational hours. Additionally, resin producers, who support the production of treated lumber and composites, switched over their operations to produce sanitizers to meet the demand for hygiene and cleaning products, often at a high profit margin making them reluctant to switch back their operations.

Despite the decreased production, demand for lumber has actually increased. Construction has continued to rise fairly steadily over the past few years, and many living in coastal cities have been finding they need more space to juggle work and personal life. Whether they choose to augment their space with Modern-Shed or build a new home farther inland, they are feeling the effects of the current lumber market. Add in all the Covid-DIYers, as well as increased tariffs on Canadian lumber, and we have landed in our current situation.

What’s the fix? Just last week, senior officials from the National Association for Home Builders met with Commerce Secretary Gina Raimondo on the importance of finding a solution to the lumber crisis. Government leaders are looking for ways to increase domestic lumber production, which some believe has not risen to meet the increased demand even prior to the pandemic. NAHB officials reported that the administration recognizes the importance of not slowing down the housing market (and thus the entire economy, potentially), and is serious about finding a path to stabilizing lumber prices. Many other experts are optimistically predicting a bit of relief as 2021 comes to a close, as futures trading has finally seen a substantial drop. 

Lumber futures chart

In the meantime, Modern-Shed realizes that your need for space and balance doesn’t depend on market fluctuations. Rather, we continue to provide our clients highly competitive pricing, as well as our years of expertise as the pioneer of living-space shed designs. If you’re interested in taking advantage of the upcoming pricing trend, make sure to visit our website to connect with a Design Pro today!

A gray Modern-Shed in quiet woods

Adding on vs Buying big vs Modern-Shed

Here at Modern-Shed, our design professionals often meet customers who are fed up with their living situation.
When a family needs more space, sometimes the first thing they’ll consider is adding onto their home or buying a new, bigger house with an additional bedroom.
Once they embark down those paths, however, they soon realize how costly those options are.
“Whether they’ve gone to an architect or they’ve actually hired a contractor and bid a job, or they’ve researched online, they realize it’s more complex than they thought,” said Modern-Shed design pro Jeff Bergerson. “That’s when they start to open their minds to other options.”
Building a detached studio such as a Modern-Shed for a home office or guest room living space is far less expensive than adding onto your home or buying a bigger house.
For the proof, all you need is to look at the numbers.
10x18 guestroom_2The average cost to build an additional room runs anywhere from $80 to $200 per square feet, according to Home Advisor, but higher (close to $400) in competitive markets like Seattle.
For an 80-square-foot room, that comes out to upwards of $32,000 for a home addition, with factors such as size, architectural services, support beams, electrical wiring and more influencing the cost.
More realistically, however, homeowners planning a home addition are more likely to spend more than $200,000 on their remodel in areas like Seattle, San Francisco and southern California.
“The customers I talk to who have already gone through getting quotes, these people are already tired, they’re already discouraged, and they’ve spent thousands of dollars just to get drawings and bids only to find out, ‘Hey, it’s going to cost $80,000 when here I thought it was going to be $20,000,” Jeff notes. “ And it’s going to take over a year. That’s when they say that’s not close to what they expected, so they look for new ideas.”
Additionally, building an addition might require updating the rest of your house to current standards, which can be like “opening a can of worms,” Jeff says.
“If you build a detached studio, no one’s looking at the rest of your house,” he says.
For folks not interested in turning their home into a construction zone, they might be tempted to just up and move. However, the costs to upgrade to a new home are even more alarming.
In Los Angeles, the median price of a three-bedroom home that was actively listed in February 2019 was $730,000, but the median price of a four-bedroom home was $979,000, for a difference of $249,000, according to figures obtained on the real estate listing site Redfin.
In Portland, the price difference between a three-bedroom and four-bedroom home came out to $180,000, and in Seattle, the difference was even more striking: home buyers would have to shell out an average of $748,000 more for a four-bedroom home compared to a three-bedroom home.
“The cost to upgrade the size of a house is astronomical,” Jeff says. “It’s far more than they expect, especially if they’re talking about increasing bedrooms.”
Factor in the cost and stress of moving, potentially pulling your children out of their school district, leaving a neighborhood you love, and messing with your mortgage interest rate, and many of our customers come to terms with the fact that they don’t want to move.
Modern-Sheds start at a base price of around $13,000, depending on the size of the shed, and not including, taxes, delivery and installation.
“So many people want to stay where they are and they just need to find another solution and that’s how they’re discovering us,” Jeff says. “You could have a new shed four weeks from the time of your order.”