We know lumber prices are up more than 170% since mid-April as of mid-September. As housing has rebounded, the lack of lumber has materialized as a key weak spot for housing supply. With that in mind, what’s the market share of alternative framing methods?

For better or worse, wood framing remains the dominant construction method for single-family homes in the U.S., according to NAHB analysis of Census Bureau data. For 2019 completions, 90% of new homes were wood-framed. Another 10% were concrete-framed homes, and less than half a percent were steel-framed.

On a count basis, there were 814,000 wood-framed homes completed in 2019. This was an 8% gain over the 2018 total. As noted above, steel-framed homes are relatively uncommon, with a total of just 3,000 housing completions in 2019, which was the same as the 2018 tally.

However, concrete-framed homes experienced accelerated growth. The total was up 46%, increasing from 59,000 completions in 2018 to 86,000 in 2019. The gains over the last 10 years are more striking. From 2009 to 2019, the concrete-framed total increased by 258% and the market share doubled from 5% to 10%.

Some of these gains came from a shift in geography. Concrete-framed homes are more common in the South. In fact, such homes made up 17% of all homes completed in the South. But the shift to home building in the South was not the only factor, as the share of all homes in the U.S. built in this region increased from 50% in 2009 to just 55% in 2019. The national gain for concrete-framed housing was also driven by share gains within the South itself, rising from 8% in 2009 to 17% mentioned above.

Hurricane-related building codes are thus part of the explanation, but the run-up in lumber prices in 2018 may have also moved the needle. And given the historic acceleration of lumber prices in 2020, more builders will be investigating alternative framing methods, including steel and concrete.

According to the Unemployment Insurance Weekly Claims Report released by the U.S. Department of Labor today, weekly initial jobless claims decreased during the week ending September 12, and continuing claims, which lag initial jobless claims by one week, decreased as well for the week ending September 5. The data indicate that labor market improves modestly, but the road to a full recovery may be long.

In the week ending September 12, the number of initial jobless claims decreased by 33,000 to a seasonally adjusted level of 860,000, from the previous week’s revised level. Initial jobless claims have remained just below 1 million with new methodology applied since September. This week’s new claims brought the 26-week’s total to 61.0 million. The four-week moving average decreased to 912,000, from a revised average of 973,000 in the previous week.

Meanwhile, the number for seasonally adjusted insured unemployment (in regular state programs), known as continuing claims, decreased by 916,000 to a seasonally adjusted level of 12,628,000 in the week ending September 5. It is the lowest level after continuing claims hit 24.9 million in the early of May. The four-week moving average declined to 13,489,000 from the previous week’s revised average of 14,021,750. The seasonally adjusted insured unemployment rate increased by 0.7 percentage point to 8.6% for the week ending September 5. The previous week’s rate was revised up by 0.1 percentage point.

The U.S. Department of Labor also released the advanced number of actual initial claims under state programs without seasonal adjustments. The unadjusted number of advanced initial claims totaled 790,021 in the week ending September 12, a decrease of 75,974 from the previous week.

The chart below presents the top 10 states ranked by the number of advanced initial claims for the week ending September 12. Like the previous two weeks, California, New York and Texas had the most advanced initial claims. California led the way with 230,225 initial claims, followed by New York with 62,950 initial claims and Texas with 49,644 initial claims. Meanwhile, South Dakota, Vermont and Wyoming had the least advanced initial claims across all the states.

Compared to the previous week, Indiana, Nevada and Kansas had the largest increases in advanced initial claims for the week ending September 12. Indiana reported an increase of 2,596 advanced initial claims. Nevada increased by 2,583 and Kansas increased by 2,271. Texas (-15,647), California (-13,179), and Louisiana (-9,257) had the largest decreases in advanced initial claims.

As record-low mortgage rates continue to fuel housing demand, pending home sales increased for a third straight month in July.

The Pending Home Sales Index (PHSI), reported by the National Association of Realtors (NAR), is a forward-looking indicator based on signed contracts. The PHSI rose 5.9% from 115.3 in June to 122.1 in July. On a year-over-year basis, sales were 15.5% higher than a year ago, the largest gain since early 2014.

All four regions saw an increase in month-over-month contract activity, ranging from 0.9% in the South to 25.2% in the Northeast. On a year-over-year basis, PHSI grew in all four regions as well, with the Northeast seeing the largest gain (20.6%).

The V-shape sales recovery suggests that the housing market is leading a post-COVID economic recovery. Though both existing home sales and new home sales hit new record high this month, home inventory remains lean and home prices continued to grow in June. This may put homeownership out of reach for some buyers. More listings and home construction are needed to meet this rising demand.