Lumber prices have been on a rollercoaster ride over the past year, and the latest dip could provide some relief for apartment developers. After reaching a record high in April 2021, lumber prices have fallen 47% year-to-date. That significant decline is starting to translate into lower construction costs, as the price of lumber is one of the largest inputs into the cost of building an apartment.
For developers who are already in the construction process, the lower lumber prices will help to boost their margins. And for developers who are still on the sidelines, the lower construction costs could help apartment projects to pencil. In either case, the recent decline in lumber prices is good news for the apartment market!