May 23, 2018
News Latest News | Poll Questions | Lunch Debt | Robert Indiana | Stolen Shed

When oil prices go through the roof

Contributed | BDN
Contributed | BDN
By Nick Sambides Jr., BDN Staff

EDDINGTON, Maine — Melissa Simpson wants her new roof to last longer than she will.

The 50-year-old commercial credit analyst and her husband, videographer Dave Simpson, 49, are renovating their two-story modified Cape with new roofing, some new flooring and insulation work. They hope the upgrade is the last their home will need in their lifetimes.

But the Simpsons doubt that will happen. It’s a desire at least partially thwarted, they say, by the high cost of asphalt shingles, which forced them to buy roofing rated to last 35 years rather than something more durable.

“We did consider the lifetime shingles, but with the other work we did, we needed to cut back somewhere, and we opted to cut back on the shingles,” Simpson said Thursday. “The lifetime shingles were probably another $4,000 more than what we spent. Had it been maybe $2,000 more, we could have done it.”

Today’s Poll

Will the high price of asphalt shingles alter your plans for a new roof?



View results

The Simpsons aren’t alone. Nationally, the price of asphalt shingles, which cover the vast majority of houses in the United States, rose 57.5 percent from March 2008 to this past March, according to the federal Bureau of Labor Statistics’ Producer Price Index. This year, it went up 3.8 percent from February to March alone.

Given that asphalt is a crude-oil derivative, soaring petroleum prices last summer accounted for much of the rise in asphalt shingle costs, said Bob Kenney, owner of Kenney Construction Co. of Bangor, which is re-roofing the Simpson home.

“The prices went up last summer for two reasons,” Kenney said. “Shingles are a petroleum product, and they are heavy to transport.”

Gas prices have dropped since then and the housing market is in a slump, yet the cost of shingles rises still. A “square,” or three bundles of asphalt shingles — enough to cover a 10-foot-by-10-foot area — that a typical contractor paid about $65 for last year at bulk discount rates now costs about $90 a square, said Peter Horch, owner of Horch Roofing LLC of Warren.

Over the last three years, the bulk-buying price has jumped from $45 to $90 per square, said Horch, whose company’s 15 workers typically re-roof about 300 dwellings annually. “There’s been a consistent spike every three months of 8 to 12 percent,” he said.

The spike is more recently being propelled by an odd force — federal stimulus money, Horch said.

With the federal government pouring billions into road reconstruction, the housing market faces a shortage in asphalt as shingle manufacturers compete with road builders for the inky, bituminous substance, he said.

“The manufacturers are stockpiling,” Horch said. “We actually visited a plant in Massachusetts about a month ago and their yard was full of shingles, and their plant was running 24-7, because they were nervous that in a few months, they might not have any raw materials coming in.”

Homeowners can economize with less-durable shingles, but “their impact would be that you are going to see more shingles end up in landfills because they have a shorter life,” Kenney said.

Still other homeowners are forgoing re-shingling, usually one of the most unavoidable home repairs, leaving recessionproof roofers scrambling for work. A year ago, Horch could count on seeing one-third of all the estimates he gave customers produce assignments.

Now, one estimate in five leads to a job, he said.

“From what I have seen, the ‘legitimate’ roofers — those who pay roofing general liability insurance and workers’ comp for employees — are getting underbid by guys who are just doing work out of the back of a pickup truck,” Horch said. “It’s getting very cutthroat.”

Kenney sees his business enduring a series of transitions propelled by the bad economy. Customers who might have built additions onto their homes are more conservatively shepherding their investments by re-roofing. Some use certain energy-saving reflective asphalt shingles that carry a tax credit of up to $1,500 from the federal government.

Others turn to steel roofing, normally as much as 50 percent more expensive than asphalt.

“If the asphalt prices continue to go up, and the cost of steel, which has actually moderated, stays where it is, you might see more people transition to steel roofs,” Kenney said. “People still need roofs.”

Homeowners can save themselves from the rising costs by working with smart contractors such as Kenney, Melissa Simpson said. Informed of a looming price increase, Kenney offered in March to buy shingles for her roof then, at the lower rate, if the Simpsons agreed to have the work done in the summer.

“He really helped us out,” she said.

The Associated Press contributed to this report.


Have feedback? Want to know more? Send us ideas for follow-up stories.

You may also like