The chart above shows weekly framing lumber prices (red line), which closed today at $400 per 1,000 board feet, the highest level since September 2005, more than seven years ago. Over the last year, lumber prices have increased by 43.4%.
Meanwhile, the S&P Homebuilders ETF (blue line) closed today at 28.21, which is the highest closing price since July 2007, more than five years ago. Over the last year, the S&P Homebuilders ETF has increased by 52.7%.
Bottom Line: The chart above shows the close historical relationship between framing lumber prices and the S&P Homebuilders ETF. Now that the housing and construction sectors are rebounding, we’re also seeing that housing boom reflected in rising lumber prices.