How accurate are those “estimates” that are being provided to you by your insurance adjuster for insured repairs to your home?

Eye on Housing

The Bureau of Labor Statistics (BLS) released the Producer Price Indexes (PPI) for January. Energy prices continued their recent decline, the index for finished goods was pushed up modestly by an increase in the price of food goods, while core prices (i.e., excluding food and energy) rose by 0.2%, the average over the last year.

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But the prices for certain building materials have moved up sharply. Gypsum prices rose 12% in January from December, mirroring a steep increase at the beginning of 2012, and are now 27% above year ago levels.

The pattern of price increases for wood products has more closely reflected improvements in the housing market. Prices for softwood lumber rose 7% in January while OSB prices rose 9%. Lumber prices are up 25% from levels last year, but OSB prices have outpaced the housing market recovery, rising 77% since last year.

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Producers of gypsum and OSB have…

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