Lumber Prices Surged, But Was It Price Gouging?
It was a question on many minds during the height of the pandemic: Can companies legally charge four times the usual price for something like lumber during a crisis?
For small contractors and homebuyers across Georgia, the lumber price spike wasn’t just frustrating, it felt deeply unfair. But it wasn’t exactly illegal. .
This real-world scenario offers a powerful case study in the economic principle of supply and demand, and why not every dramatic price increase qualifies as price gouging under the law.
What Actually Happened to Lumber Prices?
When the COVID-19 pandemic hit in early 2020, sawmills across the U.S. slowed production or shut down entirely. The assumption was that economic uncertainty would halt new home construction. But something unexpected happened: a housing boom.
Driven by historically low interest rates and a surge in remote work, demand for new homes and renovations skyrocketed. This caught the lumber industry flat-footed. The result? Far more demand than supply, resulting in skyrocketing prices.
By mid-2021, lumber prices had surged past $1,500 per 1,000 board feet, almost three times more than pre-pandemic levels. Contractors in Georgia, especially smaller firms with tighter margins, found themselves priced out of projects. Homeowners felt it too. According to the National Association of Home Builders, the lumber shortage added as much as $36,000 to the cost of a new single-family home at its peak.
Supply and Demand vs. Price Gouging: What’s the Difference?
It’s easy to mistake soaring prices for price gouging, but legally, they’re not the same thing.
Supply and demand is an economic principle: when demand increases and supply stays the same or drops, prices naturally rise. That’s what happened in the lumber market. There wasn’t collusion, fraud, or a deliberate effort to exploit consumers. There simply wasn’t enough wood to go around.
Price gouging, on the other hand, is when sellers take advantage of a state of emergency by charging excessively high prices for essential goods or services. In Georgia, the Attorney General enforces laws against price gouging, but only on items considered necessary to support public health and safety, like food, gasoline, water, and medical supplies.
Lumber doesn’t typically fall into that “essential” category, which means price hikes (yes, even steep ones) are usually legal if they reflect market forces.
What If Something Still Feels Off?
Even if price increases are legal, Georgia consumers still have options. Especially if they suspect something deeper than market fluctuation is at play. Here’s what you can do to stay in control:
- Keep records. If you’re a contractor or homeowner, you need to make sure to document every quote, price change, and vendor communication. If anything becomes suspicious, this documentation will be helpful.
- Know your rights. If you believe a business is unfairly inflating prices without justification, or colluding with others to fix prices, you can report it to the Georgia Attorney General’s Consumer Protection Division.
- Compare before you commit. Don’t assume all suppliers are pricing the same. Even during high-demand periods, price discrepancies can reveal potential bad actors or better deals.
Where Do Prices Stand Today?
Thankfully, the lumber market has calmed since the chaos of 2021. As of mid-2025, prices have stabilized to between $450 and $600 per 1,000 board feet, depending on region and season. That’s still higher than pre-pandemic levels, but a far cry from the eye-watering highs of the early pandemic years.
Though the supply chain has mostly recovered, it remains vulnerable to disruption. Price hikes can and will certainly happen due to things like wildfires, international trade changes, or labor shortages. So even though they’re no longer in crisis mode, don’t be surprised if we see another shortage, and probably sooner than later.
The Bottom Line
The lumber surge wasn’t price gouging, it was just economics doin’ it’s thing. Still, the experience was a tough lesson for Georgia consumers and small businesses alike: just because something’s legal doesn’t mean it’s easy to absorb.
So what can we learn?
Understand how markets move, stay informed about your rights, and if something feels exploitative, don’t be afraid to question it!
Has a price spike ever left you wondering if you were being taken advantage of, or simply caught in a market storm? The answer isn’t always clear-cut, but asking the right questions is a powerful place to start.