Building Materials Industry and Lumber Market Watch

Market Watch: Trends in Lumber and Wood-Based Building Materials

Jun 01, 2023

It’s no secret that infla­tion and sup­ply chain issues have plagued the lum­ber and wood-based build­ing prod­ucts mar­ket in recent years. High­er prices, sup­ply short­ages and longer lead times passed from the man­u­fac­tur­er down to the home­own­er have led many con­sumers and Pros to con­stant­ly won­der, When will the cost of build­ing mate­ri­als go down?” 

Beyond pric­ing chal­lenges, in a HIRI study con­duct­ed in May 2022, more than half of pro­fes­sion­al con­trac­tors sur­veyed report­ed to the Home Improve­ment Research Insti­tute that lum­ber, ply­wood and oth­er build­ing mate­ri­als were the pri­ma­ry dri­vers of their extend­ed project delays. 

As the indus­try con­tin­ues to nav­i­gate pric­ing and avail­abil­i­ty chal­lenges, it is crit­i­cal for man­u­fac­tur­ers and retail­ers to stay informed about where the mar­ket is head­ed and what projects cus­tomers are con­tin­u­ing to com­plete. This knowl­edge will help ensure you con­tin­ue to meet cus­tomer demand and remain competitive.

So, what should you know about the out­look for the lum­ber and wood-based build­ing mate­ri­als indus­try? Let’s take a look at recent mar­ket per­for­mance and ana­lyze some con­sumer pref­er­ences to get a com­pre­hen­sive pic­ture of the state of the lum­ber and build­ing mate­ri­als market.

State of the Building Materials Market

The wood-based build­ing mate­ri­als mar­ket has expe­ri­enced both pos­i­tive and neg­a­tive per­for­mance in recent years, and cur­rent HIRI size-of-mar­ket research points to a con­tin­u­a­tion of that pattern. 

Con­sid­er these figures:

Consumer Market Growth by Merchandise Line


Mer­chan­dise Line

2018 – 2022


2024 – 2027

Dimen­sion­al lum­ber and boards




Ply­wood and relat­ed products




Gyp­sum and spe­cial­ty boards




Professional Market Growth by Merchandise Line


Mer­chan­dise Line

2018 – 2022


2024 – 2027

Dimen­sion­al lum­ber and boards




Ply­wood and relat­ed products




Gyp­sum and spe­cial­ty boards




As the data shows, the boom in build­ing and home improve­ment sparked by the COVID-19 pan­dem­ic result­ed in high demand for wood-based build­ing mate­ri­als. How­ev­er, this trend was fol­lowed by unsus­tained sup­ply due to the dis­rupt­ed sup­ply chain. In 2023, the indus­try will like­ly expe­ri­ence the oppo­site effect, with a gen­er­al low­er demand for build­ing and con­struc­tion result­ing in a long-term recov­ery for the market. 

Key insight: While these fig­ures may present an uneasy image for 2023, the out­look for com­ing years is def­i­nite­ly pos­i­tive. Wood-based build­ing mate­ri­als man­u­fac­tur­ers and retail­ers should con­tin­ue mea­sures to keep oper­a­tions steady while plan­ning for how to strate­gi­cal­ly take advan­tage of com­ing peri­ods of growth.

Product Purchasing and Consumer Decisions 

In the HIRI study track­ing prod­uct pur­chas­ing trends of lum­ber and oth­er build­ing mate­ri­als, HIRI found that:

  • 38% of prod­ucts in the cat­e­go­ry are pur­chased for a planned repair/​replacement

  • 21% of pur­chas­es are part of a larg­er remod­el­ing project

  • 21% are pur­chased for a planned add

  • Only 14% of pur­chas­es are made for an emer­gency repair or replacement

  • Most pur­chas­es are made by home­own­ers or their spouse

  • 21% of pur­chas­es are made by a hired professional

Types of Projects

Wood con­tin­ues to be the dom­i­nant mate­r­i­al used in deck, patio and porch projects, account­ing for 67% of all mate­ri­als used.

Accord­ing to HIRI’s 2021 Project Deci­sion Study, home­own­ers are more focused on enhanc­ing or build­ing decks (49%) than patios (39%) or porch­es (23%). How­ev­er, in all of these projects, enhance­ments are more com­mon than new builds, with 33% of deck projects and 29% of patio projects focus­ing on enhancements.

Homeowners are typically motivated to take on these projects to:

  • Update or add fea­tures to the home (47%)

  • Address the need for repair or main­te­nance (44%)

  • Update the look (43%)

On the oth­er hand, new builds are split almost equal­ly between entire­ly new struc­tures (51%) and replace­ments (49%), with an increase in the lat­ter since 2019 (from 37%).

These indi­ca­tors are pos­i­tive sig­nals for the build­ing mate­ri­als cat­e­go­ry as the new home con­struc­tion mar­ket sees var­i­ous, and expect­ed, slow­ing down and speed­ing up peri­ods fluc­tu­at­ing through­out 2023 and 2024.

Planned Home Improvement Spend

In the HIRI study track­ing home­own­ers planned projects over the next 90 days and how much they plan to spend on those projects, for Q2 of 2023, here’s how much home­own­ers sug­gest­ed they would spend on projects that often include a num­ber of lum­ber and build­ing mate­r­i­al components:

  • Home exte­ri­or shell — $1,000 (down from $1,200 in Q1 of 2023)
  • Base­ment or attic — $700 (up from $600 in Q1 2023)
  • Exte­ri­or struc­tures — $500 (down from $600 in Q1 of 2023)
  • Garage — $500 (con­stant from Q1 of 2023)
  • Out­door liv­ing areas — $500 (down from $800 in Q1 of 2023)
  • Shop/​Hobby Room — $500 (up from $350 in Q1 of 2023)
  • Laun­dry room, mud room, util­i­ty room, or sun­room — $400 (up from $350 in Q1 of 2023)

Key insight: Since the major­i­ty of lum­ber and build­ing mate­ri­als are pur­chas­es for a planned repair or replace­ment, sen­ti­ments are pos­i­tive that there will be con­tin­ued demand for wood prod­ucts even dur­ing sea­sons when res­i­den­tial new home con­struc­tion may slow. The age of the exist­ing hous­ing stock spark­ing demand for com­plet­ing repair and main­te­nance projects, plus con­tin­ued home­own­er inter­est in out­door liv­ing projects are fur­ther pos­i­tive sig­nals for the lum­ber and build­ing mate­ri­als sales outlook.

Key insight: This demand for wood in deck projects high­lights the grow­ing trend in out­door liv­ing and the desire of home­own­ers to either build or update an out­door liv­ing area. 

Channel Trends

When it comes to the shop­ping chan­nel of choice, home cen­ters are the most fre­quent­ly used sup­pli­er, with 73% of sur­vey respon­dents pur­chas­ing through this means. In-store pur­chas­es make up most trans­ac­tions (70%), while online trans­ac­tions account for 16%.

Top Purchase Locations

  • The Home Depot: 38%

  • Lowe’s: 23%

  • Menards: 8%

Key insight: This data sug­gests that man­u­fac­tur­ers of build­ing mate­ri­als should pri­or­i­tize their chan­nel rela­tion­ships with these large, big-box retail­ers if they wish to ensure that their prod­ucts are promi­nent­ly fea­tured in spaces their cus­tomers fre­quent most often.

Building Material Purchasing Preferences 

What exact­ly are con­sumers look­ing for in their wood-based build­ing mate­ri­als? Read on to dis­cov­er key pur­chas­ing pref­er­ences bro­ken down by build­ing material. 



  • Hard­wood: 62.8%

  • Soft­wood: 37.2%


  • Unfin­ished: 78.2%

  • Fin­ished: 21.8%

Most cus­tomers (76.5%) buy lum­ber from home cen­ters, with 73.4% pre­fer­ring in-per­son pur­chas­es and 3.1% mak­ing online pur­chas­es. An addi­tion­al 10.4% of cus­tomers pre­fer to shop in per­son at a lum­ber­yard or build­ing sup­ply store, and 2.8% choose a ware­house mem­ber­ship club.

Drywall/​Gypsum Board


  • ¼ inch: 13.8%

  • ½ inch: 47.1%

  • ⅜ inch: 28.6%

  • ⅝ inch: 10.4%

Most cus­tomers (83.9%) buy drywall/​gypsum board from home cen­ters, with 73.6% pre­fer­ring in-per­­son pur­chas­es and 10.3% mak­ing online purchases.

Panel Products


  • Ply­wood: 63.8%

  • Par­ti­cle board: 21.2%

  • OSB/​waferboard: 7.7%

  • Wall pan­el­ing: 6.1%

  • Oth­er: 1.2%


  • 2 × 4: 28.3%

  • 4 × 8: 64.6%

  • Oth­er: 7.1%

Most cus­tomers (76.9%) buy pan­el prod­ucts from home cen­ters, with 75.1% pre­fer­ring in-per­son pur­chas­es and 1.8% mak­ing online purchases.

HIRI mem­bers have access to the full Prod­uct Pur­chase Track­ing Study for more detailed cat­e­go­ry insights.

Looking Ahead

The wood-based build­ing mate­ri­als prod­ucts mar­ket has faced sig­nif­i­cant chal­lenges in recent years. How­ev­er, pos­i­tive strides have been made in sup­ply chain recov­ery and demand for these mate­ri­als will con­tin­ue even through an eco­nom­ic slowdown.

Because the mar­ket is chang­ing, as are cus­tomer behav­iors, If you are a pro­fes­sion­al oper­at­ing in this cat­e­go­ry, join HIRI as a mem­ber for access to detailed reports that will keep you up to date on the lat­est mar­ket and cus­tomer trends. 

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