"The 16 to 20 per cent hikes we received in October are still in effect well into April..."
April 18, 2017 by John Bleasby
Our coverage of the Western Canadian drywall tariff issue, and more recently the continued high prices after tariffs have been reduced, has frustrated this Alberta home builder and cost him profit.
I have been looking into this with our suppliers since the announcement in Feb. There appears to be a ton of confusion as to not only if the pricing will be adjusted but what about the return of the overage also committed too in the ruling. This has cost us all dearly and the only people making the profits here are the ones who stirred the pot to begin with: CertainTeed Gypsum and the wholesale companies.
Our suppliers say they have no information from their chain of command on any of it (stalling I feel) and that prices have remained and will stay the same until they do. In addition when drywall went up the suppliers – and more specifically wholesale supply companies – also took the opportunity to raise all affiliated products (tape, bead and mud) by 16 – 20%. No justification given for these increases just that it was needed and time (US exchange blah blah blah).
In the end the 16 -20% hikes we received in October are still in effect well into April with no signs of any changes into May. My supplier said they will get back to me if they hear anything.
I would love to hear or see the government enforce this ruling so that we can see a relief on this pricing. A ruling without calculating and enforcement is like a speed limit without cops. “Fine yourself if you feel you did a bad thing,” is the attitude.
For our average home (2,100 sq.ft. 2 storey with triple garages) this increase has added up to around $3,800 in additional costs. Most of which has been absorbed and taken out of our margin as many of the homes we presently have under construction were pre-sold at pre-drywall increase prices. Got to tell you this has taken about $40K in revenue out of our operation.
Very frustrating and I would urge all builders to ask for an enforcement and return of the already stolen revenue from western Canada building projects.
Rococo Homes Inc.,
Spruce Grove, AB