MISSOULA — COVID-19 shutdowns and remote work are having an economic impact in Montana, and it's taking the form of a hot real estate market.
Missoula’s housing market is booming, but that’s not just affecting buyers and sellers.
Prices for building materials are inflating and it’s impacting local businesses.
“I think affordability is out the window. We’re just trying to keep it in check,” Wade Hoyt, Hoyt Homes President, told MTN News.
Hoyt has spent nearly 30 years building homes in Missoula.
He told MTN News the costs for building materials have increased significantly in the past year, and he’s never seen anything like it.
“The price of a building right now is rising so fast and it’s just difficult to predict. And it’s distressing," Hoyt said.
Costs for building materials and amenities like cabinets, fireplaces, and roofing are increasing without reprieve.
To give you an example of just how much prices are increasing, last year, a single sheet of 4X8 7/16" sheathing material cost around $8 dollars per sheet. Now, it costs close to $50.
Hoyt Homes partnered with Edgell Building to provide Missoula one housing solution. Hellgate Village used a lottery system to sell homes at a more affordable rate.
But Hoyt said even those homes increased by an average of $65,000 in just six months during building.
“We spend a good deal of our time re-bidding jobs, and then we have to give the bad news to the customer or we have to raise the price,” explained Hoyt.
When a lumber yard like Boyce Lumber and Design Center gets a call from Hoyt Homes, an estimate for materials is made up for that project. A salesperson then draws up a price based on market costs.
A year ago, the job was routine.
“Trying to secure inventory was, you know, usually one, two phone calls. Now it's 10,15,” David Boyce, Boyce Lumber General Manger, told MTN News.
Manager David Boyce is a 4th-generation Boyce taking care of the family business. He told MTN News the upward trend started last August and has not stopped.
“This is historic pricing,” Boyce said.
Commodity market data on the Nasdaq stock index shows a steady increase in lumber over the past five years.
The past year shows a nearly 300% price hike.
Despite the challenges, Boyce said his staff is keeping up with the action.
“We're just doing the best we can to protect our customers, our clients that have been with us and, you know, make sure that they have supply, so they can continue to work,” Boyce said.
MTN News will continue to keep the community informed as this story develops in western Montana.