Rising lumber costs are adding $24,000 to the average price of new homes

·1 min read

We're nearly a year out from the start of the pandemic, but the material costs for new home construction are still abnormally high, according to Rachel Flint, vice president of Hubbell Homes.

Why it matters: Those costs will be absorbed into homes under construction this year, meaning already sky-high prices will rise in the future.

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  • It also means now is the time to buy a new home, Flint said.

By the numbers: Rising lumber costs are adding $24,000 to the average price of new homes, according to the National Association of Homebuilders.

  • Interest rates are still low, but they ticked back up to 2.8% for a 30-year fixed loan this month, according to money.com. Some borrowers could get 2.5% or lower in December.

The state of play: Affordable newly constructed homes under $275,000 are in high demand in the metro, Flint said.

  • "We can't build those fast enough," Flint said.

The weather affects everything: The last two weeks of record-low temperatures also slowed the homebuilding season, said Dan Knoup, executive officer of the Homebuilders Association of Greater Des Moines.

This story first appeared in the Axios Des Moines newsletter, designed to help readers get smarter, faster on the most consequential news unfolding in their own backyard.

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