New-home purchases account for about 10% of the market and are calculated when contracts are signed. They are considered a timely barometer of the current real estate market.
Sales of new single-family houses in the US for February 2021 were at a seasonally adjusted annual rate of 775,000, according to estimates released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development.
This is +8.2% above the February 2020 rate but is down -18.2% from January 2021, which was at a revised rate of 948,000. Harsh winter weather across almost all of the continent is to blame for the reduction, which is expected to be temporary.
Benchmark Softwood Lumber Prices March & US NEW Home Sales Feb 2021
Demand for housing is being driven by Americans seeking more space for home offices and schooling as the year-long coronavirus pandemic drags on.
Builder backlogs of projects awaiting construction remain elevated and indicate residential building will stay firm in coming months and contribute to economic growth.
Benchmark Softwood Lumber Price Western Spruce-Pine-Fir 2×4: 2018 – 2021
For the week ending March 19, even as sales waned according to Western S-P-F sellers in the US, the undersupplied nature of the market remained apparent. One savvy trader noted, “Inventory is your friend.” Sawmill order files were into the first and second weeks of April depending on the source and item. Logistical efficiency was also variable from mill-to-mill.
While Western S-P-F producers in Canada continued to emphasize strong demand, sales were definitely quieter last week. Sawmill order files were into the week of April 12th and shipments remained roughly three weeks behind that. Low grade was again a focus among active buyers as its discount to #2&Btr attracted more business.
Madison’s Benchmark Top-Six Softwood Lumber and Panel Prices: Monthly Averages
STAY AHEAD of US home sales data by getting access to softwood lumber prices. Released every Friday for that week, since 1952 Madison’s Lumber Prices is used by the forest products industry as a price guide for North American construction framing dimension softwood lumber. These are, of course, the inputs into US and Canadian home building materials.
Shrewd investors know that construction framing softwood lumber prices are a good leading indicator for US housing activity, including home building and home sales. Don’t miss out, get lumber price data updates directly to your desktop every Friday morning: https://madisonsreport.com/subscribe/