But the price of wood has escalated since then. A builder in steel knows what the price will be a year from now. If lumber costs more than that, steel becomes the more cost-effective material, says Jeffrey Prostor, president of Brookfield Homes. Lumber prices were particularly volatile in 1997. Randy Smith, NAHB's president, wants the Clinton administration to renegotiate the trade agreement with Canada.
Builders now have a guide for specifications when using steel.
A builder previously wasn't prevented from using steel, but he was required to seek guidance and approval from an engineer. This led to delays and raised the price tag of the home. Some builders have found that although steel costs less than lumber, other costs raise the price tag for steel-frame homes. Generation Homes of Valparaiso, Ind., sells steel and wood homes at the same price. Steel costs less, but the labor is more expensive, says Dennis Henderlong, the company's president.