NBN Online for the week of March 8, 2010

Lumber, Materials Prices to Rise as Housing Recovers

Barely beginning to emerge from the most devastating housing downturn since the Great Depression, home builders in the early months of this year have been confronted by a significant run-up in lumber prices.

For the week ending on Feb. 19, the Random Lengths composite index stood at $317 per 1,000 board feet, its highest level since the first half of July 2006. That price was up more than 26% from the start of this year, when framing lumber was averaging $251.

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Lumber Prices Provided by Random Lengths

Builders Go Head to Head With Foreclosures and Win

From Las Vegas, one of the epicenters of the housing meltdown, John McLaury, senior director of sales for KB Home Nevada, reported that his company has scored measured sales success by zeroing in on the foreclosed properties flooding the local housing market and pursuing strategies to compete with them.

NAHB Finds Construction Costs Are Three-Fifths of Home Price

Built-for-sale or “spec” homes have been particularly hard hit by the housing downturn, according to a new NAHB survey on the various components that go into the price of a typical single-family home.

Based on responses from 54 builders in 2009, “Breaking Down House Price and Construction Costs” found a relatively high proportion of custom homes — homes built on a lot owned by the customer, who hires a general contractor to perform the construction work — rather than spec homes.