U.S Construction market shortages and delays
Will Australia face the same issues?
Lennar, which is the nation’s second-largest homebuilder, has increased lead times by as much as 7 times in some cases to give manufacturers additional flexibility. Still, it expects constraints will continue “into the fourth quarter and beyond,” especially as builders face a growing backlog of orders.
Co-CEO Jon Jaffe said Monday the entire homebuilding industry is facing labor constraints and shortages — particularly of “engineered wood, windows, garage doors, paint and vinyl siding” — that were limiting the company’s ability to keep up with real estate demand.
Although lumber and other material costs remain high, it’s shortages of labor and other key items that are delaying production for builders and biting into sales.
“While some building materials, like lumber, have seen easing prices, delivery delays and a lack of skilled labor and building lots continue to hold the market back,” said Robert Dietz, chief economist for the National Association of Homebuilders, in a statement.
The market has stabilized somewhat since the housing frenzy’s height last year as companies adjust to supply chain instability. Lennar has taken steps to increase visibility into the extent of shortages, working to increase lead time or in some cases bring in alternate manufacturers.
Prices for key materials including lumber have also eased somewhat. Builder confidence in September inched up for the first time in three months on lower prices and higher supply, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index.