Katrina hits home in local building industry
Higher prices expected, but builders unsure how much costs will climb
As the aftermath of Hurricane Katrina ripples through the economy, Knoxville-area homebuilders are bracing for building-material shortages and price increases. And that means homebuyers can expect to pay more, too.
The big unknown is how much the cost of lumber, cement, drywall and other materials will escalate and how long shortages will last, Knoxville-area building industry executives said Wednesday.
"We expect a gradual rise in the cost of building materials, but right now we don't know what the long-term effect of the hurricane will be on prices," said Mike Stevens, president of Mike Stevens Homes Inc.
What is known is that the storm disrupted the supply of materials coming out of the Gulf Coast, and higher fuel costs have significantly increased transportation costs.
"We're all concerned about fuel costs. Across the board, everything we buy has higher transportation costs," said Stevens, who flew to Reno, Nev., on Wednesday for the National Association of Home Builders board meeting, where he expected much conversation about Katrina.
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Clearly there are going to be supply disruptions, the question is whether they will last, or whether these are temporary spikes which can be ameliorated by other sourcing.
(The article goes on to say that home builders around here (at least) have stopped giving price quotes more than 120 days out. I would think they'd be a little shy of even that time window.) |
