Even though case numbers have improved, there are many ways COVID is still wrecking havoc, and the U.S. economy is one of those victims. In a pre-pandemic world, "retailers often absorbed the cost when suppliers raised prices on goods, because stiff competition forced retailers to keep prices stable," The New York Times recently reported. But, "the pandemic changed that." With global shipping markets destabilized, the nation has seen shortages and sudden price inflation—meaning you're likely spending more money these days. However, not all products are seeing inflation at the same rates—some big ticket items are more likely to give you sticker shock than others. Read on to find out which items are seeing the worst inflation, to learn what not to spend your money on right now.
Home renovation projects
After spending a year in lockdown, you're probably well aware of all of the corners of your home that need renovation. But experts say that prices for raw materials, like paint and lumber, are currently inflated given the sky-high demand for such products.
CNBC reports that because of this, nearly half of all builders say they have recently added escalation clauses to their contracts, ensuring that homeowners are responsible for any unexpected cost increases for materials. Experts estimate that home repair and residential building costs are currently up over 12 percent compared to this time one year ago.
While laying low at home during the pandemic, many of us found solace in nesting. Comfort and functionality took center stage as we transformed once-unoccupied spaces into makeshift offices and upgraded our living rooms with cozier couches to spend the year on. The result? A four percent growth rate for furniture sales in 2021.
"Anything in the home-goods category continues to see high demand and often higher prices—especially for items that are selling out or hard to get," Kimberly Palmer, a personal finance expert at NerdWallet, told Reader's Digest.
Irv Blumkin, Nebraska Furniture Mart Chairman, told Market Watch that the price of one shipping container has skyrocketed over the last six months from $3,500 to $10,000. Without shipping capabilities, international suppliers have halted production and that's why prices are sky-high right now.
The car market first collapsed in the early months of the pandemic while most of us stayed home, then spiked as people came to view car ownership as a safer alternative to public transportation, according to CNN. This heightened demand, combined with a shortage of microchips used in many of today's cars, has driven up prices over recent months.
"New vehicles—particularly new trucks and SUVs—are basically the 2021 equivalent of toilet paper and hand sanitizer a year ago," Jessica Caldwell, Edmunds' executive director of insights, said in a statement at the end of April. "Dealers and automakers are making good profits right now since consumers seem to be a bit more accustomed to paying more for goods in the past year, and new vehicles are no exception."
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If instead of hitting the open road, you were planning to book a flight, you may want to think again—but not for safety reasons. Your post-pandemic getaway may come at a seriously high price.
Domestic airfare rates are reportedly up nine percent since Apr. 1, while international flights are up 17 percent, CNBC reports. Hotel rates have also risen in recent months, making vacations cost prohibitive for many would-be travelers.