Following a few months of moderating prices last spring and summer, lumber prices are soaring once again.
Over the past four months, lumber prices have nearly tripled, causing the price of an average new single-family home to increase by more than $18,600, according to the National Association of Home Builders’ standard estimates of lumber used to build the average home.
This lumber price hike has also added nearly $7,300 to the market value of the average new multifamily property, which translates into households paying $67 a month more to rent a new apartment.
According to Random Lengths, as of Dec. 29, the price of framing lumber topped $1,000 per thousand board feet—a 167% increase since late August. Developers said that this pricing environment is leading them to include escalation clauses in their contracts and more often spec building to preserve margins.
The longer-term picture, though, is worrisome.
Without a solution, developers must adapt to new forms of construction, including manufactured housing, non-lumber-based materials, and higher density of smaller units to attempt to keep the cost to each consumer within an affordable rangeChris Loeffler, CEO and co-founder of Caliber
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As the Wealth Development Company, we are a leading U.S. sponsor with approximately $500 million in assets under development and management. These investments are comprised of alternative investments, which include private funds and syndications, externally managed real estate investment trusts (REITs) as well as public funds. We conduct substantially all business through our Sponsor, CaliberCos Inc., a vertically integrated platform that is strengthened by more than 70 professionals with decades of institutional experience in commercial real estate, capital markets, alternative investments, and mergers and acquisitions.
We allocate our alternative investment strategies and align them with investors’ investment objectives, risk profiles and liquidity preferences to offer an optimal balance of risk-adjusted returns and attractive investment performance. It is because of this thoughtful, intentional approach, and our unwavering pursuit of performance, that we have been deemed The Wealth Development Company.
We strive to build wealth for investors by offering a diverse host of investment solutions that fit our investors’ needs. With a primary focus on key middle-market growth areas, such as Arizona, Colorado, Nevada, Texas, Utah and Alaska, we evaluate other U.S. markets that possess the same attractive demographics and macroeconomic trends as our targeted markets, such as highly skilled labor, emerging population and job growth. In addition, we utilize our institutional full-service operating platform to generate operating efficiencies while enhancing the value of our investments through dedicated asset management strategies.
We create value through a combination of internal and external growth channels. Bringing together the benefits of real estate, deep asset-class, and capital markets expertise across public and private investments. We seed, develop, and manage a broad range of liquid and illiquid alternative strategies for a diverse group of investors who comprise approximately a $4 trillion alternative investment market, which includes high net worth, accredited and qualified investors, as well as family offices and smaller institutions. This strategy allows us to opportunistically compete in an evolving middle-market arena for alternative investments that range between $5 million and $50 million.
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If you would like to speak to someone about diversifying your retirement accounts, contact us at [email protected] or call (480) 295-7600 to schedule a call with a member of our Wealth Development Team.
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