Roofing Materials Prices Increased By 30% Due To High Oil Prices And Massive Tornadoes!

It’s been widely reported and discussed on various roofing forums that manufacturers are drastically raising the prices of their roofing shingles and accessories that go along. Some roofers report getting letters from their suppliers that shingles prices are going up as much as 30%. Keep in mind that in the spring of every year, mos manufacturers raise their prices by 3-8% on average, so this new increase in the cost of roofing materials is something out of the ordinary.


Current roofing materials’ prices (as of June 6, 2011)

We’ve done some digging on current asphalt shingles prices, and first checked out two major retailers’ websites: the Home Depot and Lowe’s. These two huge home improvement retailers do not take long to update their prices and usually get the best deals from roofing manufacturers. Here is what we found:

Home Depot has pulled ALL roofing materials (excluding flashing, underlayment, and other random roof-related products) off their website – I feel this means that new updated pricing is coming soon. We will check back with Home Depot in a couple of days to give you exact information.

Just as a side note, we used Home Depot’s prices for our Roofing Materials Calculator, and those prices date back to November 2010. The prices were based on GAF / ELK 30-year architectural shingles and the price per bundle of shingles was $27.95 + tax.

Lowe’s website does have roofing prices up online, and here is what they have:

Owen’s Corning (OC) 30-year architectural / dimensional / laminate shingles cost $30.95 per bundle. The 3-tab shingle is $27.95 per bundle. Some special color options in 30 year architectural shingles go for about $34.23.

Do note that Home Depot and Lowe’s carry different brands, and OC shingles are typically slightly less expensive than GAF / ELK shingles. Also, do understand that prices are on per-bundle basis, where as roofs are measured using roofing squares, so you actually need three bundles to install one sq. of roofing, before waste. Therefore, Lowe’s sells one square of 30 year arch. shingles for about $93.

We want to make a point that these prices may be out of date at the time we write this article, and I will be calling my suppliers to verify the current prices. You should know that most contractors go through roofing suppliers, and not national home improvement chains, when they buy materials. We, on the other hand, specialize in installing metal roofing materials (and metal roofing prices vary a lot, especially compared to asphalt shingles), as well as PVC flat roofing, and therefore are not always current on the asphalt shingles prices.

Why The Current Increase In Roofing Prices?

This is a very good question and I will give you my opinion on this, along with roofing manufacturers’ and suppliers’ reasoning.

The basic premise here is that oil prices went up to and above $100 / barrel levels once again, just like back in 2008, and since asphalt shingles are made with asphalt ( right – eh 🙂 ), which is an oil refining by-product, the cost to manufacture them also went up. Additionally, transportation costs are up due to higher gasoline / diesel prices.

On top of that, with multiple devastating tornados ravaging the south and midwest, there were many damaged roofs, and now the demand for roofing materials is also up. Here is what a supplier has to say:

…Due to the natural disasters around the country the demand for roofing materials has now increased 30% as of May 23rd, and will continue to rise throughout the rest of the year, as well as the increase in oil, fuel and to cover the delivery charge…

Is it really so? While these are somewhat valid reasons – the truth is, tornadoes ravage the south and midwest every year, as well as hail storms, etc. Therefore the reason for roofing prices spike due to “increased demand for roofing materials”, sounds fishy at best. Spike in oil prices? Well – read below.

Why Roofing Prices Skyrocket Every Time There Is a Spike In Oil Prices, But Never Come Back Down?

Back in 2008, when oil prices went up to $140 / barrel, and the US and world economy tanked soon after, roofing prices went up from about $65 per square to about $75-80 (based on 30 year architectural shingles). After the US economic crisis hit hard and homeowners were more concerned with paying mortgages and bills, roofing prices could have come down a bit, and yet they stayed at $72-75 levels, until spring price hikes. By November 2010 they were at $84 / square levels.

However at the same time, oil prices dropped into $40-50 / barrel territory, so leaving all things the same, asphalt shingles prices had to go back to $65 / square levels, but they never did. For us, our PVC roofing supplier also had a dramatic increase in their flat roofing prices – about 10% if I recall correctly. Well – the thing is, while asphalt shingles do use oil in the manufacturing process, PVC roofing uses no petroleum products at all! PVC is made of rock salt and natural gas, so the price increase from IB Roofs, was a bit of a shocker to me, especially as the economy was dropping like a rock.

So here is the thing – all manufacturers use special circumstances such as $140/barrel of oil, to jack up the prices, and their customers get accustomed to higher materials costs. Once the hype is over, no manufacturer will drop prices, unless they have to, such as was the case in the fall of 2008, when roofing sales went down 20-30%.

Basically we (both consumers / homeowners and contractors alike) are being fed this nerve ending and tear-letting story of how the “poor” manufacturers are struggling to keep prices down, but due to an unforeseen situation, they just have to raise them… oh well, as long as we keep buying, they will keep raising prices :(.

To me, it is all one big scam, and unless national media jumps on this story, things will never change.

P.S. – note to contractors who are using our roofing calculator app – don’t forget to update your materials prices, so that your estimates are in line with the current pricing situation.

P.P.S – we will be updating our roofing calculator software, to better reflect current materials prices, and will update this post once we gather all current shingles prices from the Home Depot, and local suppliers.


Low End
$4837
Mid Range
$6046
High End
$7558

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11 thoughts on “Roofing Materials Prices Increased By 30% Due To High Oil Prices And Massive Tornadoes!

  1. Pingback: Roofing prices drop to 2006 levels

  2. Adam

    I am starting a roofing company in central PA. My biggest hurdle is getting my name out there. Any suggestions? Leo how did you do it?

    Reply
    1. Leo - roofer with a vision Post author

      Adam – here is a couple of articles I wrote about this topic:

      How to start a roofing company – basic of organizing and getting first jobs.

      How to market a roofing business and get leads – how to find customers online.

      Should you go solo or with a partner – pros and cons of having a partner in your roofing business.

      And also we have a complete guide (or a reference page) for roofing contractors, covering various topics – roofing contractors guide, as well as a roofing companies directory, where you can list your business.

      Reply
  3. George

    Hi Leo, thanks so much for the reply. You are right. I didn’t take into account dump fees. I underestimated materials a bit.

    On a philosophical discussion though, I do think it is important for customers to be informed and knowledgeable, and part of that is understanding if ABC is attempting to make too high of a profit off of you. For example, since I have current quotes at $2,500, $2,800, and $4,300, all with the same configuration, it is clear that the $4,300 guy is attempting to profit too much off of me. So, yes, I think it is my business to try to understand their profit margin. That’s why home owners like me google “roofing materials price increase” and find your web site!

    Reply
    1. Leo - roofer with a vision Post author

      Hi George,

      I actually tried to reply to you a couple of days ago, but accidentally pressed back button, and lost the comment…

      Any way – we agree about the philosophical aspect of this, and that is why we created this site in the first place – to inform homeowners about real roofing prices and how they are “composed”, what goes into pricing a roof, cost of roofing materials etc.

      As for your roof – I don’t know what it’s like, as you never provided much info about it. So I assumed it to be about 5 square simple gable roof. It could be bigger, and more complicated, as homeowners OFTEN underestimate how difficult the roof actually is, and do not even consider so many time consuming things that seem small and non essential to them. Therefore, the $4300 quote may actually be the “right” one for what you got, and $2500/2800 guys are just low-balling the roof, to keep busy, or they do in fact pay very little for labor, use somewhat “defective” or so called “SECONDS” roofing materials (such as those that have been in the supplier’s yard for 3-5 years, and are deeply discounted, but are also of a lower quality, and so on and so forth.

      But if the $4300 is in fact inflated by some “big name roofer” – I completely agree with you that you should not pay more for something that you can get for less, in the same quality. In fact, on our sister site, I wrote a vinyl siding prices article, where I explain how the “big name” outfits operate, by doubling their prices, and hiring the same siding contractor subs, who you could hire for half the price.

      – But –

      There are so many factors to consider even for a small job like yours. I will include part of my email correspondence with potential client about a 250 sq. ft. seemingly simple roof, which is however located deep in the woods of Maine, with nearest Home Depot and Lowe’s about 25 miles away:

      If your roof in fact has just one layer, we can dump it locally – the closest landfill I found is in Sebago – but maybe you know places closer to your home.

      Basically, your roof is not big and we can do it in one day, but if there are some unforeseen things, I want to factor them in. I don’t want to make it a two days job, because it will be more for you – we would have to stay over in a hotel, since you are about 100 miles from us.

      From what I can see in the pictures and base on previous experience – there should not be any major unknown problems, except for maybe lot’s of rot under the roof, which we can fix.

      I assume the roof sheeting is boards (1×6 or 1×8), or plywood. In our price we include replacement of up to 50 linear feet of boards, or 3 sheets of plywood, if needed.

      I would like to know if you know of any rot / soft spots on your roof, and if you know what is the roof sheeting type. Reason for this is that the nearest lumber yard I found in google is about 10 miles away, and they may not have what we need. If we start driving around looking for something small, it can take very long time, while the guys may be waiting for it. I want to avoid this.

      Also, the shingles roof on the opposite side of the dormer – is it 3-tab or architectural shingles? Do you have some extra ridge cap or if it’s 3-tab, some extra shingles? We usually put the shingles back on the roof, and install a special barrier on the flat part, which prevents the wind driven water from getting into the ridge opening. If we can’t reuse the ridge cap that is there now, we will need to replace it, and once again – it’s driving around, looking for things.

      You can see how we normally do the ridge line transition here:

      http://www.coolflatroof.com/flat-roofing-blog/low-slope-roofing-on-shed-dormers/

      and here:

      http://www.coolflatroof.com/flat-roofing-blog/flat-roof-installation-andover-ct/

      We can also do it by installing the membrane over the ridge line. I would need to know if that works for you. It would save us a lot of potential driving. Optionally we can bring some dark grey shingles of the ridge cap. I can see in the pictures you already have two different colors of ridge cap.

      Here is what the roof looks like:

      Low Slope roof

      That is how much organizational thought goes into even a small roof.

      Reply
  4. George

    I wouldn’t mind it if the roofer himself is getting a decent wage. What I’m talking about is ABC Roofing Company paying the roofing guys $12/hour and then keeping the lion’s share of my payment.

    Going back to one of my questions, which ties in to the title of this posting …. I had a quote for $2,250 in 2008, and the same guy just re-quoted at $2,500. Reasonable?

    Reply
    1. Leo - roofer with a vision Post author

      George,

      I think that a $250 increase in 3 years is more than reasonable. As I explained before, with 4% annual inflation (12% over 3 years), $250 increase is about what you should expect as time goes by. In addition, the cost of shingles has gone up since 2008, by $35-40 per square, and also all accessories went up in price as well. So if your garage is say 6 squares, that increase is justified by just roofing materials cost increase, without taking inflation into effect.

      Back to how much ABC roofing company should make. I think that they do not pay $12/hr, as it’s pretty difficult to survive with that little money. However, even if they do, I am positive that your math is incorrect – merely because you are a homeowner, and you omit / ignore / unaware of certain costs that a roofing company incurs in its day-to-day operations.

      First, even if they pay 4 guys $12/h, and a foreman gets say $20/h, that is about $560 per day. Let’s assume they do not pay worker’s comp / taxes / etc, and the $560 is all they spend on labor. Let’s say your roof is 5 squares – that is about $750 in roofing material + cost of plywood / OSB – about $150.

      Then there are dump fees or dumpster cost. A dumpster is at least $250, and even if your contractor has a dump-truck, they still need to drive the debris to the landfill and pay refuse fees and pay the driver.

      Then there is day to day operating / overhead costs for the business itself – advertising cost, accountants, taxes, business supplies, liability insurance, maybe a secretary, other thing. Then the business owner or a salesmen, needs to goo meet with homeowners to sell jobs, and many of them do not turn into jobs, so that’s wasted time and money.

      Bottom line – here is what we have: $560 (labor) + $900 (materials) + $250 (dump fees) = $1710 in direct costs. That leaves $790 in gross profit – which is VERY little for a business, and from that you need to subtract all indirect costs.

      So yea George – it is a good deal, and the ABC roofing contractor is not making a killing here.

      And also – it is non of our business how much ABC Roofing Company is making in profits – even if they made 50% net profit – it is their business – they are in business to make money. If you or I feel they charge too much – we don’t have to give them our money. But to say they make too much money is WRONG!

      Reply
  5. George

    I’ve got a simple old-fashioned, standalone garage with a decrepit roof with 2 layers. Every time we get a good wind, I pick pieces of roof off the ground. I’ve had recent quotes from roofing companies of $2,500, $2,800 and $4,300. All for stripping, re-decking w/OSB, and 3-year GAF. Why the vast differences?

    More importantly, the $2,500 quote comes from a company who quoted $2,250 in mid-2008 (I should have done it then).

    When I calculate roofing material pricing, and estimated labor (what, maybe 5 guys at $12/hour?), it seems like their profit margins are much higher than I would think. That is, I feel gouged. Should I?

    Reply
    1. Leo - roofer with a vision Post author

      George,

      I will jump straight to your last question: The profit of a roofing company is their business, and for each firm is different, as are the fixed cost and overhead… But – should you feel gouged?

      I want to ask you George – would you want to tear off a two-layer roof, clean it up, remove old boards, than carry up sheets of OSB and nail them down, for $12 / hour? I think not. I also think that expecting roofers to make just a bit more than kids in McDonald’s is just wrong. And yea, your garage is probably easy, but these guys climb triple-deckers, often without fall protection, and roof sitting on a piece of foam.

      I mean – of course we all want to pay less, but come on – roofing is a dirty, difficult job, and we all want our roof not to leak, so we want good roofers to install it. And good roofers should be paid adequately. $12 /hour is not adequate.

      Also, roofing is a business, and a business needs to make money to stay on business. And of course the try to make more money… but in the end it all comes down to market prices – how much one party is willing to pay, and the other party is willing to sell for. Basically if you feel that $2500 is too much for a garage roof, find someone to do it for less. Btw, $250 increase in 3 years is less than inflation, and definitely does not reflect the increase in materials cost. So it is actually cheaper to do it now, at $2500, than it was 3 years ago at $2250.

      Any way, I think, $2500 – 2800 is not much, but I don’t know the size and other details of your roof. $4300 … IDK … may be it is the right price, and other guys are just lowballing … who knows.

      Bottom line – “you get what you pay for” works most of the time …

      Reply
  6. Jack

    Lowes in my area have increased the price for Roofing Shingles approximately 40% in the last 5 months. I e-mailed Owens Corning and they blame the retailers for the price increase.

    Reply
    1. Leo - roofer with a vision Post author

      Hi Jack,

      How much are the OC shingles in your area’s Lowe’s right now? And where do you live?

      I think it is all a one big scam where roofing manufacturers are blaming distributes / suppliers of roofing materials, and “high oil prices” and vise versa, while everyone is making money.

      I think if more metal roofs are installed, then material prices will drop, and asphalt shingles manufacturers will get the memo and become more competitive. However I don’t see this happening, as there is too much of a price gap between metal roofing prices and asphalt shingles, and there are always more people who want the rock-bottom price. Therefore, shingles will outsell metal roofing for next 15-20 year, assuming oil prices will remain more or less “realistic”.

      It’s too bad, because the consumer is the one who gets taken for a ride, regardless.

      Leo.

      Reply