Scott Ashcraft, president of Las Ventanas Homes in Albuquerque, said higher costs for building homes are likely here to stay and that people shouldn’t wait for dramatic decreases in material.
“Not at all. So that's the interesting thing,” he told New Mexico Sun. “You know, we have lots of conversations with clients about the high building costs and should they wait to build. And to be honest, my advice at this point is I don't see it coming back down. So, I don't think that's going to be to your advantage.”
During the last year, the price of lumber has been in the news a great deal. The National Association of Home Builders said it’s an issue that deserves attention and action from elected officials.
Scott Ashcraft
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“The escalating lumber prices are largely due to insufficient domestic production and extremely large lumber mill curtailments that lasted well into the 2020 building season,” the NAHB reports. “NAHB has reached out extensively to the Biden administration and other government officials calling for prompt action. During a recent House Appropriations subcommittee hearing, Commerce Secretary Gina Raimondo acknowledged the issues surrounding lumber and promised to take action.”
Raimondo said it’s clear the industry is “struggling” and vowed to investigate and try to find a solution.
But Ashcraft said that alone won’t lower housing costs.
“You know, obviously, lumber is the commodity that's getting the most attention and lumber’s up over 300% in the last year from March of last year to now,” he said. “But the reality is, it's every building material we're seeing increases, everything from the cement and the rebar in the foundation all the way to the material used for the roofing. We're seeing increases in prices of the materials all across the board.”
He said there will be some modifications to the market.
“I do think that we will see lumber prices retreat over the course of the next few months,” Ashcraft said. “I should say, I hope we will see lumber prices retreat over the next few months, but at the same time, we're seeing every one of those other materials go up. So, the reality is the overall cost of construction, I don't see that decreasing.”
As material prices skyrocket, largely due to the COVID-19 pandemic that caused mills to reduce their production, higher costs were passed along to home buyers. People are paying tens of thousands more for a house than what they originally planned.
“Well, obviously it's very dependent on the size of the house. But I will tell you that the National Association of Home Builders uses a figure on the average house that's just under $40,000,” Ashcraft said. “That is absolutely 100% accurate. Now, that being said, I just priced a house that currently today my contract with the customers right at about $1 million. And two years ago, I would have been able to build that house for about $800,000.”
Ashcraft is a past president of the New Mexico Home Builders Association, founded in 1959. It has more than 1,900 trade members.
Ashcraft, 49, has lived in Albuquerque his entire life and has been in the home-building industry for more than two decades. It’s a family business that constructs about 20 custom homes a year, ranging in price from $600,000 to $1.6 million.
“I'm actually the fourth generation of my family to be on the job here in Albuquerque, ever since the early 1930s,” he said.
Ashcraft said he has hauled lumber and pounded nails, learning the business from the ground up.
“I have absolutely done a little bit of everything,” he said.
He literally wrote the book on his profession. "Building a Quality Custom Home: What You Need to Know" was published in 2020. Dave Konkol served as his co-author.
“This book is dedicated to my father, grandfather, and great-grandfather,” Ashcraft wrote. “I am grateful to carry on the family tradition as a fourth-generation homebuilder.”