Prices paid for goods used in residential construction declined 0.4% in November (not seasonally adjusted) according to the latest Producer Price Index (PPI) released by the Bureau of Labor Statistics. However, the price of softwood lumber and gypsum products have increased.
Building materials prices have declined an average of 0.1% per month over the last 12 months, and the price of goods used in residential construction has risen 1.3% in 2019. Not only is that price growth roughly one-third the pace of increases in 2018 (+3.8% YTD), it is the slowest year-to-date growth in four years. In 2015, the price index of goods used in residential construction declined 0.8% between January and November.
The PPI report shows that softwood lumber prices increased 3.5% (seasonally adjusted) in November. The index for softwood lumber has risen 7.7% over the prior three months and now stands at its highest level since September 2018.
The price index for gypsum products increased 1.1% in November after advancing 1.4% in October (seasonally adjusted). Gypsum products prices declined by 9.6% over the first six months of 2019 but have increased 5.7% since. Even after accounting for the recent increase, however, prices remain slightly lower than they were at the start of 2018.
See more at NAHB’s Eye on Housing blog.