Fed Chairman Expresses Hope Building Material Bottlenecks will be Alleviated
Federal Reserve Chairman Jerome Powell expressed hope that building material bottlenecks that have raised housing costs will begin to ease during a hearing today before the House Financial Services Committee on monetary policy and the state of the economy.
“Single-family housing demand been quite high and in addition prices have been driven up by material shortages which we hope will be alleviated,” Powell told lawmakers. “On the supply side, they [builders] can’t build enough houses. There isn’t enough lumber,” the Fed chairman added.
“Lumber prices have gone way down but they are still twice as high as before the pandemic. We don’t know it, but we think that will be the pattern – prices come down as more supply comes online to meet the higher demand.”
Powell also made it clear that while the Fed can affect interest rates, it can do very little to remedy supply side issues that builders continue to deal with.
“There are limitations around the availability of some raw materials and labor and of zoning and things like that and nothing we can do will really affect that,” said Powell.
Although he said that affordable housing is largely out of the purview of the Fed’s responsibility, Powell noted that this “is certainly a very important issue.”
This is also a top priority for House Financial Services Committee Chairwoman Maxine Waters (D-Calif.), who announced at the hearing that she will be introducing the Housing is Infrastructure Act this week “to ensure that Congress finally makes long overdue investments in the housing market. This bill would provide a historic investment of more than $600 billion to ensure that affordable housing is available all across the country.”
Latest from NAHBNow
Sep 17, 2025
Housing Starts Remain Soft Ahead of Fed MeetingOverall housing starts decreased 8.5% in August to a seasonally adjusted annual rate of 1.31 million units, according to a report from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.
Sep 16, 2025
Tradeswomen Paving Their Own WayNAHB spoke with Professional Women in Building (PWB) members Elyse Adams and Brittney Quinn about their career paths in the trades and how PWB has positively influenced their journeys.
Latest Economic News
Sep 17, 2025
The Fed Cuts and Projects More Easing to ComeAfter a monetary policy pause that began at the start of 2025, the Federal Reserve’s monetary policy committee (FOMC) voted to reduce the short-term federal funds rate by 25 basis points at the conclusion of its September meeting. This move decreased the target federal funds rate to an upper rate of 4.25%.
Sep 17, 2025
Housing Starts Remain Soft Ahead of Fed MeetingChallenging affordability conditions continue to act as headwinds for the housing industry, but the sector could see lower interest rates in the near future with the Federal Reserve expected to cut short-term interest rates this afternoon.
Sep 16, 2025
Builder Confidence Steady but Future Sales Expectations Hit Six-Month HighBuilder sentiment levels remained unchanged in September but lower mortgage rates and expectations that the Federal Reserve will soon cut the federal funds rate led to higher future sale expectations in the coming months.