Survey: 20% of builders are using alternative building materials

Industry Insights

Framing lumber prices finally peaked at around $1,500 per 1000 board feet in mid-to-late May. Since then prices have started to fall, providing some relief to the residential construction industry, but they are still almost twice what they were six months ago. 

With these increased costs, we were curious how residential construction businesses were affected. Were their profits suffering or were they able to pass along the bloated pricing in higher material costs? Were they turning to alternative building materials instead of lumber? To answer these questions and more, we asked more than 90 leaders in the residential construction industry in the US. 

About the survey

We conducted this survey from June 18, 2021, to June 30, 2021, and received more than 90 responses. Our customers answered questions asking about the effect of lumber prices on their business and their attitudes toward alternative building materials. CoConstruct’s construction project management software helps over 100,000 building professionals manage clients and trade partners, schedule work, track financials, and more.

The big takeaway? 

Higher lumber prices forced a majority of residential construction businesses to consider, investigate, or switch to alternative building materials. Overwhelmingly the largest factor in considering or using alternative building materials was a prolonged period of increased prices rather than lumber crossing a certain dollar threshold.

Below are the full survey results respondents shared with our team.

How have increased lumber prices affected your business?

 2020 Residential construction survey: increased lumber prices attitude

Inflated lumber costs added nearly $36,000 to new home prices according to the National Association of Home Builders. When it comes to how home builders and remodelers were dealing with these costs, respondents were split. 65.9% of US home builders and remodelers said they were able to pass along these increased costs to their clients in the form of higher material costs while 33% said they had to eat the additional material costs in lower profit margins on their projects. Notably, nearly all US builders were affected by increased lumber prices in one way or another with only 1% of respondents saying they were unaffected by lumber prices. 

Which of the following describes your company’s attitudes toward alternative building materials?

2020 Residential construction survey: alternative building materials

US home builders and remodelers are evenly split when it comes to their attitudes toward alternative building materials. 24.2% of respondents said they have not considered alternative building materials while 30.8% have considered them. Over a quarter of respondents said they are investigating using alternative building materials in their business and 19.8% of respondents are currently using them. Lumber prices have been an issue for so long that affected businesses have had a chance to not only research but implement alternative building materials into their projects. 

What made you start using or consider using alternative building materials?

2020Residential construction survey: using or considering using alternative building materials

For US home builders and remodelers that considered, investigated, or started to use alternative building materials, they all shared a similar story. 61.1% of respondents said they made the move to start looking for or using alternative materials because of a prolonged period of high lumber costs. For the rest of the builders, 22.2% of respondents made the move after lumber prices crossed a certain dollar threshold while 16.7% made the move due to other economic factors.

How concerned are you about the increase in lumber prices?

2020Residential construction survey: concern about increased lumber and material prices

US home builders and remodelers are concerned about lumber prices, but it isn’t a top concern. 67.1% of respondents are very concerned about lumber prices but only 25.3% said that lumber prices are their top concern. A little over a quarter of respondents were moderately concerned about lumber prices and 6.6% said they were not very concerned. Whether it is due to individual companies’ specialties or financial structures or to the fact that lumber prices are finally headed in the right direction, for the majority of respondents lumber is no longer the top concern. 

If you are a home builder or remodeler looking for technology to help your business better manage material costs, construction project management software might be the right solution for you.

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Harry Wahl
Harry Wahl

Harry helps create data-driven content for the residential construction industry including case studies, customer stories, industry trends, and more.