We live in an economic environment where we don't know what the next day will bring... high energy cost and crazy inflation. As we are all aware, this started partly due to the 2020 pandemic. Everyone started working from home and realized that they needed a basement finished or an office built out. Or even just wanted to get their whole house remodel knowing they would be in the house for the long term.
Additionally, we saw on the news how lumber prices spiked nearly 400% from pre-pandemic levels. Has the price of wood come down? Yes, somewhat. But it is still nowhere close to pre-pandemic pricing. This goes for all materials. Maybe not as much of a hike as lumber, but it all went up.
And therefore, businesses expenses have been impacted. Wages had to go up, especially as the labor pool became scarce. Insurance premiums went up as did all other costs to run a company, hence why we all are paying more for everyday items, like groceries, sundries, going out to eat, and yes, construction.
For the last two years, those in the construction trade were just hoping that prices would just stabilize. Stop climbing so fast that by the time we gave a budget or estimate to the client. Another price increase on materials and then, our quotes would be no good. This was happening in every field of construction… new home building, remodeling and commercial.
The good news is things have started to stabilize, but prices have not dropped for most items. In my experience, the costs to run a business very rarely goes down, only up. So what I have to say next may sound harsh, but it's the truth. If you're not going to do a remodel now because costs are too high and you are waiting for cost to go down, you are never going to remodel!
Being in the industry for close to three decades, I have never seen costs go down enough to make any real difference to a remodeling budget. Hindsight is always 20/20. Everyone should have done their remodel pre-pandemic. So with that said, there is no time like the present!
So once again, if you're not going to do it now, you're not going to do it later. You will just be looking in the rearview mirror saying, “I should have done it back then.”
By Adam Berlin, President, Maverick Home Remodeling, Inc.
