The rising cost of wholesale wood and metal could add about $5,000 to $7,000 more to the cost of building an average-size home, say economists for the National Association of Home Builders.

 

Random Lengths, a trade publication for the lumber industry, reported that the price of oriented strand board and plywood has more than doubled in the past year, and surged to a record high for the week ended April 16. Also, framing lumber prices soared from $282 per 1,000 board feet to $439 in the past year, and are now at the highest level since July 1999.

 

Nation’s Building News Online, a weekly NAHB online newspaper, reports that about 90 percent of the demand for oriented strand board is in residential construction and remodeling, and this type of board has increasingly displaced plywood. Production of oriented strand board only grew slightly from 2002-03 and will increase an estimated 4 percent this year, while the closure of several plywood plants could offset this increase, the NAHB reports. And the cost of a 4-by-8 sheet of oriented strand board jumped from $6 to $16 in the past year.

 

To combat rising materials costs, NAHB lawyers have drafted contract language for escalation clauses in home sales to insulate builders from price spikes. And NAHB also offers information about alternative materials that builders can substitute for traditional materials.

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