Page 8 - Georgia Forestry - Issue 4 - Fall 2022

ECONOMY
Supply vs. Demand
Housing and the North American Solid Lumber Markets
By John Casey
If you’ve watched the housing market over the past two years, you’ve probably had a few jaw-dropping moments. It’s no secret that a perfect storm, fueled by pandemic lockdowns and pockets flush with stimulus money, caused an exodus from urban areas to the suburbs, with renters turning into first-time home buyers seeking fresh air and more open space.
JOHN COONEY
Equity Analyst
ERA Forest Products Research
The sudden surge in demand led to immediate spikes in home prices as buy- ers made offers thousands of dollars over asking prices. As many homes in move-in condition were being scooped up in record time, eyes turned toward fixer-upper prop- erties and new builds. They were projects requiring solid lumber, which was in short supply due to pandemic-related factory shutdowns. That’s when lumber prices went haywire, said John Cooney, equity analyst at ERA Forest Products Research — but everything is on its way back towards normal, or at least somewhat.
“So I’ve been in this industry for about a decade. And the last two years have been something else. I work with people who have been at this 30, 40, 50 years and it truly has been an unprecedented couple of years,” said Cooney at this summer’s Georgia Forestry Association Annual Conference. “The question we get on a daily basis is: Is this the new normal or do we slide back to 2010 to 2015, when a $5 weekly increase was noteworthy news? I think the answer is somewhere in the middle.”
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