Adding to new-home costs
Rising materials costs are affecting new-home construction too, according to Les Thomas, president of Shea Homes Southern California, a Western U.S. homebuilder with developments throughout the Southland.
Higher prices for lumber, drywall, cement and other materials “probably translated to a 5% to 10% increase” in the price of new homes last year, Thomas said, adding that the booming California real estate market played a far larger role in the rapid escalation of prices.
Because new homes are priced “at market level,” Shea doesn’t disclose what percentage of a home’s price covers increases in materials costs.
“We don’t tell our customers, ‘Oh, by the way, $5,000 ... was for cost increases,’ ” Thomas said.