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Cost of materials for construction up, raising overall building costs

Published: Mar. 24, 2021 at 5:17 PM CDT
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RAPID CITY, S.D. (KOTA) - The housing market in the Black Hills has been booming in the last year, with many homes going up across the area.

While the pandemic generally has not impacted the timeline or manpower, some projects saw delays due to issues in the supply or manufacturing of the materials.

It is simple supply and demand, from new houses, to the lumber needed to build these homes.

“Whether it’s pandemic-related, whatever it is, we know people are moving into this state and that definitely has an impact on how busy we are,” said Daene Boomsma, the owner of Boom Construction. “But, the overall construction industry is absolutely swamped right now.”

Boomsma said while the demand is high for new home construction, the supply of materials is low, resulting in high prices.

“In the environment that we’re in today, it is really hard for us to lock in pricing for any length of period at all,” said Boomsma. “Lumber is literally changing weekly. From a year ago- last March until now- some of the products are up 400%. Last March, we paid $9 and change for OSB, and today, we pay $37-$38 a sheet per OSB.”

Supply of products went down, due to factory shut downs, but the demand for construction went up.

“Until a national shift happens in the economy and the availability of products, we’re going to continue to battle this,” said Boomsma.

Boomsma said they are not committing prices or even timelines because of the constant fluctuation in prices, or timing delays.

“We’re not willing to sign contracts today because we don’t know what the price is going to be at in two weeks,” said Boomsma. “And, if we don’t get to start that project for a month or more out, the way the trend has been, pricing is going to be higher, and we can’t just eat all of those price increases.”

Boomsma said some scheduling had to be adjusted on projects, which stretched the timeline on many projects.

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