Lumber prices and alternatives

Been to Lowes 2-3 days in a row. Almost no one in (fully stocked) lumber area. Maybe people are sick of paying the high prices?

Side note;
Have a neighbor that put up 500' +/- of fence. He used pine/oak with the bark for fence post. I wonder how long they will last? I could see maybe dipping the ground end in creosote/rubber to help.
 
hunterdan said:
Been to Lowes 2-3 days in a row. Almost no one in (fully stocked) lumber area. Maybe people are sick of paying the high prices?

Side note;
Have a neighbor that put up 500' +/- of fence. He used pine/oak with the bark for fence post. I wonder how long they will last? I could see maybe dipping the ground end in creosote/rubber to help.
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I have heard of using Locust wood.

I think homeowners wanting to do small projects are certainly putting them off. I went to a local sawmill for the lumber to build my two shelters and the owner said he’d done a lot for folks doing stuff like that this year.

People who have to have some lumber for a repair or something are gritting teeth and buying but “wants” are definitely being put off.
 
The other thing that puzzles me is the amount of building I still see. Who is buying these homes which probably cost 30-40% (or more) more than a year ago?
 
sammi_davis said:
maybe we can borrow some Biden bucks to finance the lumber yards!
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Those rich lumber distributors need to share their wealth!!! The poor harvesters and shippers are missing out on all this rape :stirthepot:
 
ponykilr said:
The other thing that puzzles me is the amount of building I still see. Who is buying these homes which probably cost 30-40% (or more) more than a year ago?
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People who are getting loans for 25% lower rates than they had before, and suck at math.
 
ponykilr said:
Who is buying these homes which probably cost 30-40% (or more) more than a year ago?
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I know several home builders. We talk frequently, and every update @Jody Treadway gives, I send a group txt to my GC buddies. They give ME feedback as well. NONE...and I mean NONE of them have said the owners of the homes they are building right now have said "now wait a damn minute" (except me of course...I just flat cancelled my build entirely)

When they get an updated price, or have to go to another state for material at a stupid price increase, every single owner has said "DO IT...DO IT NOW!"

And what's funny is the owners range from $200k homes to $600k homes.

For some reason it doesn't matter. I don't know if the rates are so good that paying more doesn't bother them or what...but even at 2.6% paying $100k over is NOT good math
 
CasterTroy said:
I know several home builders. We talk frequently, and every update @Jody Treadway gives, I send a group txt to my GC buddies. They give ME feedback as well. NONE...and I mean NONE of them have said the owners of the homes they are building right now have said "now wait a damn minute" (except me of course...I just flat cancelled my build entirely)

When they get an updated price, or have to go to another state for material at a stupid price increase, every single owner has said "DO IT...DO IT NOW!"

And what's funny is the owners range from $200k homes to $600k homes.

For some reason it doesn't matter. I don't know if the rates are so good that paying more doesn't bother them or what...but even at 2.6% paying $100k over is NOT good math
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For me its simple math, as I am one of those people you are referring to! We pulled out a calculator and figured if I rent for 2 years(that 12-16 months for a hope in price drop and build time) for a place close to what we are building then I would break even on what I paid in rent and what I paid in the up charge in timber.
 
CasterTroy said:
I know several home builders. We talk frequently, and every update @Jody Treadway gives, I send a group txt to my GC buddies. They give ME feedback as well. NONE...and I mean NONE of them have said the owners of the homes they are building right now have said "now wait a damn minute" (except me of course...I just flat cancelled my build entirely)

When they get an updated price, or have to go to another state for material at a stupid price increase, every single owner has said "DO IT...DO IT NOW!"

And what's funny is the owners range from $200k homes to $600k homes.

For some reason it doesn't matter. I don't know if the rates are so good that paying more doesn't bother them or what...but even at 2.6% paying $100k over is NOT good math
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All I know is I took my 6 digit shop build fund and moved it over to an investment fund.
Not gonna spend $150k to build an $80k shop.
I will turn $100k into $120k in a couple years and MAKE money instead.
My current shop rent is so cheap I don't lose sleep over it. Bonus for being literally 2 doors down from my lumberyard.
 
snappy said:
if I rent for 2 years(that 12-16 months for a hope in price drop and build time) for a place close to what we are building then I would break even on what I paid in rent and what I paid in the up charge in timber.
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Yeah, you've got a point I wasn't considering at all. The rent plus storage to wait it out is a HUGE factor in your situation...as I'm sure it is in many others.




Jody Treadway said:
All I know is I took my 6 digit shop build fund and moved it over to an investment fund.
Not gonna spend $150k to build an $80k shop.
I will turn $100k into $120k in a couple years and MAKE money instead.
My current shop rent is so cheap I don't lose sleep over it. Bonus for being literally 2 doors down from my lumberyard.
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This was more along the lines of what I was thinking about....folks that really didn't NEED to build..but wanted to.
 
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CasterTroy said:
Yeah, you've got a point I wasn't considering at all. The rent plus storage to wait it out is a HUGE factor in your situation...as I'm sure it is in many others.






This was more along the lines of what I was thinking about....folks that really didn't NEED to build..but wanted to.
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Rent does factor, and it makes sense if you are paying for much of the build in cash.... but if you are financing it, even with the lower rates, you have to factor the extra amount you will pay on the extra cost.
 
Jody Treadway said:
I will turn $100k into $120k in a couple years and MAKE money instead.
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I'd hope you can do a whole lot better than that.

On the home builder front, the big names (LEN, BZH, PHM, etc) have cut back on starts in the last few months. There are several reasons, cost is one, general availability is a bigger issue. The increased cost of lumber, though dramatic on its own, only adds about $30k to the average home price. Most of the stuff you see under construction now was bought out months ago, if not last year.
 
CasterTroy said:
even at 2.6% paying $100k over is NOT good math
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Zackley

Where will they be when the correction comes…more folks walking away leaving banks to their taxpayer bailouts.
 
snappy said:
For me its simple math, as I am one of those people you are referring to! We pulled out a calculator and figured if I rent for 2 years(that 12-16 months for a hope in price drop and build time) for a place close to what we are building then I would break even on what I paid in rent and what I paid in the up charge in timber.
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I am not sure how many renters are buying like your circumstance but folks buying new houses by and large are probably selling one home (at very inflated price due to demand) and buying a new just finished home (at a similarly inflated cost) so perhaps those folks are selling high enough that the inflated new home cost is a wash 🤷🏼‍♂️
 
ponykilr said:
I am not sure how many renters are buying like your circumstance
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@snappy has a pretty unique situation indeed. Family land, and unique financial situation that won't put him in the "I bought too high and I will never recoup this imbalance"
 
ponykilr said:
I am not sure how many renters are buying like your circumstance but folks buying new houses by and large are probably selling one home (at very inflated price due to demand) and buying a new just finished home (at a similarly inflated cost) so perhaps those folks are selling high enough that the inflated new home cost is a wash 🤷🏼‍♂️
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And if demand is flat and new starts are down, prices sure as shit aren't going down.
 
We’re in an exploratory phase. We own our land and it has a small decent house but we definitely sold and moved here permanently to have our retirement home.

We do not want to jump off into $50 OSB world but we’re definitely not psychic and have no idea if things will begin to get better or if this is the new normal for several years.

Add to that the tension between our grown daughter and my wife in the same space (long story I may tell sometime) and our desire to do something, even if it’s wrong, is increasing.

We talked to our bank about the ins and outs of construction loans and one thing that I need to investigate further is a point the banker made.

She said in order to have a construction loan that is Freddy/Fanny approved will require the farm be divided with the new home and old home (which is a mobile home that doesn’t even have a title, we did away with it when we closed and it is part of the land) on separate deeds. I am NOT doing that.

We have very good credit and a good amount of cash but that didn’t seem to matter as far as the dividing issue.

I may hire a “barn” done and convert to living space.
 
ponykilr said:
We talked to our bank about the ins and outs of construction loans and one thing that I need to investigate further is a point the banker made.

She said in order to have a construction loan that is Freddy/Fanny approved will require the farm be divided with the new home and old home (which is a mobile home that doesn’t even have a title, we did away with it when we closed and it is part of the land) on separate deeds. I am NOT doing that.
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Talk to Tyler or Alan.

Small bank in Kansas. They rely on no one outside. They decide who to loan too. The rates will be slightly higher, but you get around all the usual red tape.



Tyler Hoefler
Branch Manager
NMLS: 1281961
2815 Anderson Ave
Manhattan Ks 66502
Phone: (785)532-9066
Fax (785)539-2249

Alan D. Lierz
President
New Century Bank
2815 Anderson Ave
Manhattan, Kansas 66503
785-532-9066 office
785-539-2249 Fax
785-466-1045 cell phone
NMLS: 617351
alierz@newcenturybankna.com
www.newcenturybankna.com
 
CasterTroy said:
Talk to Tyler or Alan.

Small bank in Kansas. They rely on no one outside. They decide who to loan too. The rates will be slightly higher, but you get around all the usual red tape.



Tyler Hoefler
Branch Manager
NMLS: 1281961
2815 Anderson Ave
Manhattan Ks 66502
Phone: (785)532-9066
Fax (785)539-2249

Alan D. Lierz
President
New Century Bank
2815 Anderson Ave
Manhattan, Kansas 66503
785-532-9066 office
785-539-2249 Fax
785-466-1045 cell phone
NMLS: 617351
alierz@newcenturybankna.com
www.newcenturybankna.com
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Thanks. You have some experience with them?
 
ponykilr said:
Thanks. You have some experience with them?
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Yup.

When I built the shop I didn't want to pay cash simply to protect myself. No one locally would finance a construction loan on land I owned unless it was a conventional home. What I was building was anything but conventional. No one would touch it. Went to Morton builds and asked who they used to finance. They told me New Century. Called, talked to Alan, and got a loan in 2 weeks. About 60% into the construction I felt I was safe and paid the loan off, but they were willing to roll the construction loan into a conventional loan after completion for very little more than the big names.
 
Jody Treadway said:
All I know is I took my 6 digit shop build fund and moved it over to an investment fund.
Not gonna spend $150k to build an $80k shop.
I will turn $100k into $120k in a couple years and MAKE money instead.
My current shop rent is so cheap I don't lose sleep over it. Bonus for being literally 2 doors down from my lumberyard.
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But I thought the stock market is supposed to crash now? you should buy bitcoins!!!
 
CasterTroy said:
unless it was a conventional home
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This was the other thing she said. No unconventional homes. She did say steel studs and siding would fly but it had to be a conventional style.
 
DSM Turbos said:
But I thought the stock market is supposed to crash now? you should buy bitcoins!!!
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I'll stick to very conservative investments since that has worked for me for some time now.
I'm sure I'm leaving $$$ on the table. But it beats paying more for something than it's worth.
 
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