Carpe Diem

As the housing sector rebounds, lumber prices reached a 7 year high today, while homebuilder stocks hit 5 year high

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.

2 thoughts on “As the housing sector rebounds, lumber prices reached a 7 year high today, while homebuilder stocks hit 5 year high

  1. The complete graphs for both new and existing home sales are over at calculated risk. New home sales are stuck at historic lows going back to 1963. Existing home sales are drifting upwards but are still 40% below their 2005 peak.

    By any measure, the housing market remains in a steep recession with few sales and very low prices.

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