Slim supply of building materials had one builder chasing lumber truck | Business

Marling Lumber lumberyard manager Robbie Hurst said the last customer he knows of who found tongue-and-groove deck boards did so in an unorthodox way.

The customer spotted a semitrailer truck hauling a load of decking lumber down the highway and followed it. The customer tailed the semi for 10 miles until it reached its destination: a local Home Depot store.

“It was late at night, and the driver of the lumber truck just parked the vehicle,” Hurst said.

“The first thing the next morning, the customer rushed back out to that Home Depot and bought up all the deck boards that truck brought in the night before.”

Hurst’s story might sound like the urban legend of the vanishing hitchhiker, but it reveals the scramble among local suppliers and builders to get their hands on lumber and other common construction materials.

The summer of COVID-19 has seen a spike in new construction and home improvement projects locally, and some area builders and suppliers say building supplies are stretched thin.

Although some say the bottleneck hasn’t hampered work so far, they say costs are inflated, and that trend could have a ripple effect later this year or next.

One culprit is the glut of home-improvement projects that came this spring and summer as residents hunkered at home during pandemic lockdowns.

However, the bottleneck hasn’t eased much in recent weeks, and lumberyards such as family-owned Nelson Young Lumber Co. in Edgerton blame COVID-19’s impact on the manufacturing sector.

Tracy Tronnes, a manager for Nelson-Young, said prices have “doubled” this summer for materials such as framing lumber and roofing sheeting, partly because of increased demand. But the supply hasn’t improved, which she said is probably because manufacturing is still sputtering back toward pre-COVID-19 levels.

“The supply chain is highly compromised because in some states, manufacturing was shut down during COVID closures,” Tronnes said. “Some items have extended lead times. Others are just not being produced, or production is so limited that many yards aren’t able to get the product.”

She said the hardest-hit products are treated lumber and decking material, which are used in outdoor structures and framing for new construction.

Building materials, and their availability and cost, tend to be a bellwether of the greater economy.

It has become trickier this year—and, some predict, more expensive—to launch new housing starts or tackle major renovations.

“Usually, on the lumber side, if mills have this much business and the prices are at a level that is very profitable, they increase production,” Tronnes said. “This time around, the mills can’t seem to get enough workers to increase their output. It’s mainly due to (earlier) unemployment benefits, and obviously, COVID concerns.”

Prior to the pandemic, the local housing market was tight on existing homes and ravenous for new homes.

City of Janesville records show local builders filed for dozens of permits last fall and this spring to launch housing starts, and state Department of Revenue property transfer data shows a spate of sales of residential lots on contract, both indicators that housing starts continue to find a market here.

Existing home sales held steady this summer in Rock County, and in fact, prices jumped to an average of $219,000 in July, according to the South Central Wisconsin Multiple Listing Service. That’s an 11% increase over prices in June 2019.

National analysts say despite a recession and lingering high unemployment, the demand for existing and new homes is likely to remain steady, particularly in affordable markets such as Rock County’s.

Some analysts believe that’s because home ownership is becoming more attractive to people whose transition to work-from-home during the pandemic has become a more permanent arrangement.

Tronnes believes an increase in material costs will lead to consumers paying more for new homes, at least in the short term.

“But demand is up, and interest rates are still attractive, which helps keep things going,” she said.

Janesville builder John Von Trapp said his company, Von Trapp Carpentry, hasn’t been slowed by the down economy or the bottleneck in materials—at least not yet.

He said many builders had stocked up on materials for projects that were planned before the pandemic.

But he admitted it has been tricky to find some specialty items locally.

Windows, cabinetry and even stain and paint can be on a two-month wait, he and Tronnes said.

At one project in Janesville’s Courthouse Hill district, a customer of Von Trapp’s wants a large addition: a two-story attached garage with living quarters upstairs.

That plan required an oversized steel beam between the addition’s first and second floors. Such items aren’t in stock locally; Von Trapp had to get the beam trucked in from Pennsylvania.

The last time Von Trapp says he felt a similar crunch on building materials was 2002, during the lull that followed the 9/11 terrorist attacks, and in 2008, when the economy cratered during the Great Recession.

Unlike those periods, he said, this summer has been busy for contractors.

However, Von Trapp has heard local hardware store managers bemoaning a short supply of items he has never seen dwindle. Sandpaper, for instance.

“Turns out, that’s because for a while there, nobody was making glue,” Von Trapp said. “OK, so they’re not making any glue over there. So now the guy over here says, ‘Well, I guess I don’t need to make that much paper then.’ Then another guy somewhere says, ‘Oh, you’re not making that much glue or paper? Then I guess we don’t need to crush up that much sand.’

“So that’s three businesses affected at once. And that’s just one product. Sandpaper. So you can see how it might take a while for all of that to start to catch up.”