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Timothy Miller
Building material cost not dropped?

When will material cost drastically drop in our currant economy?
I sure see how not much is being built so not much is being bought...

The big box stores are mostly gost towns.

But the prices for materials sure has not fallenIt just does not reflect these facts. My stocks sure reflect the down turn in the market. Why not building materials?

havanagranite
Re: Building material cost not dropped?

I do granite counter tops and just because there are less houses being built doesn't mean I can lower the price for the tops I produce. It still takes the same amount of granite and the same amount of time to produce that set of tops. and with the economy in a downward spiral I wish I could charge more not less for that same set of tops. that isn't the case though so I have to try to save money by using all my disposable tooling more throughly with less waste and use my time more efficiently. just because there is a lower demand for tops doesn't mean I can lower my price, having money go through the office doesn't help if it is at a backward angle, we are going backward enough because of less jobs so speeding up the pace that we go backward only increases the chance that we will go out of business. this is going to be the same regardless of the size of business.

jkirk
Re: Building material cost not dropped?

i think part of this has to do with supply and demand, even though yes construction is slowing down it still doesnt mean the supply to demand ratio is

in the last 5 years, countless smaller mills for lumber, plywood and drywall have been shutdown, because of this the larger plants have had to increase their production especially when large disasters occur because whenever a large fire takes place countless homes get burnt down thus whatever supply is available gets redirected to that region for the rebuild. which in turn lowers the supply for the rest of country.

dj1
Re: Building material cost not dropped?

This question is true today as it was in 2009, and the answer is: it's all about supply and demand.

Falling domestic demand is offset by roaring international demand for building materials, due to rapid expansions, global construction and disaster replacements.

Byebye low material costs.

Big box stores may lure you to their empty stores with 1/2 price ads for ceramic tiles, but everything else you need is more than before.

HoustonRemodeler
Re: Building material cost not dropped?

Big box stores contract for those 2x4's 4 or 5 years go. Long before the trees are finished growing and cut down. The railroads that ship the 2x4's contracted to ship those a few years ago as well.

Brookworld
Re: Building material cost not dropped?

Basic, earth based raw materials actually have gone up -- copper in particular, and petro-based ingredients like plastic is all over the place.
Also, as noted by others, manufacturers also recalibrate their production to meet lower demand. (Look at airlines, they recalibrated to get 85% load instead of 75% to maintain prices to offset volatile avgas prices).

In the competitive world, they squeeze their Asia suppliers to maintain profit margins, and the suppliers squeeze back with lower quality (like using lead paint in Mattel toys -- look at the Craftsman brand at Sears -- good ol USA made vs that stuff sourced from Asia , you can tell the difference in quality and price.)

Myong Krois
Re: Building material cost not dropped?

Falling domestic demand is offset by roaring international demand for building materials, due to rapid expansions, global construction and disaster replacements.

MLB Construction
Re: Building material cost not dropped?

when gas prices drop by 30%-50% and stay that way for at least 6 months some pricing on products should start to come down. it costs an insane amount of money to ships all types of goods around the country. simple for instance, last year i spent $7,700 on gas for my two trucks....about 6-7 years ago i spent about $4,100....someone has to pay for the increase in gas and it's the customers of the stores and the customers of the contactors.

dj1
Re: Building material cost not dropped?

I hope you don't mind me bringing this topic back...

This year, I've seen sharp price increases for most essentials at the hardware store. Contractors bidding on jobs better double check material prices, so that they don't get caught underbidding.

Lumber, pipes, fasteners - you name it, they all went up. I get sticker shocks every time I step into the supply houses and there is no relief in sight.

A. Spruce
Re: Building material cost not dropped?
dj1 wrote:

I hope you don't mind me bringing this topic back...

This year, I've seen sharp price increases for most essentials at the hardware store. Contractors bidding on jobs better double check material prices, so that they don't get caught underbidding.

Lumber, pipes, fasteners - you name it, they all went up. I get sticker shocks every time I step into the supply houses and there is no relief in sight.

No kidding! I was at a big box a week or so ago picking up some drywall supplies, drywall screws were $7 for a one pound box! WTF?!?!?!?! A few days later I was in my preferred lumber supplier and their bulk screws were less than $3 per pound. The big box also didn't carry topping compound, they only had 3 or 4 brands of all purpose, again, WTF?!!?!?!?

MLB Construction
Re: Building material cost not dropped?

the thing that drives me nuts is that i prefer to buy from lumber yards and use mom and pop hardware stores, i'm 100% for small business (i'm a small business), but many times i just can't do it.

i had to buy a water shutoff valve for under a sink and there was a hardware store 1 mile away from me and a big orange about 2-3 miles away. i went to the hardware store and paid over $11.00 for one, they were about $6.00 at big orange.

in an emergency i'll pay the extra, it kills me to use these big box stores but i have to. luckily my lumber yard has contractor discounts and it brings the price a lot closer to the big box stores prices. i also have discounts at one electrical supply and one plumbing supply but i'm not always near them.

and YES....prices are getting crazy at the big box stores also.

and one last note.....my GL and WC insurance went up a total of almost $1,000 from last year and i've never made a claim.....maybe i should just give up and go live in a communist country.

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