Wood buildings do remove carbon in the mid-term, although not without risks: they can catch fire, and in this case the carbon would obviously be released.
Also, if a wood building is demolished, we have to have some strategy of handling the wood waste. Existing ways (burn it for energy, make paper out of it, make cardboard packaging out of it, etc) do release the carbon quickly. However, I suspect that if you today construct a wood building with a lifetime of 100 years, and if in 100 years we still have excess carbon dioxide in the atmosphere, the most likely waste handling mechanism when the building is demolished is actually creating biochar out of the wood and storing the biochar somewhere underground where it retains the carbon for a much longer time than 100 years.
Also, you have to remember that lumber competes with other uses of trees. Trees can be used to:
- Create paper (this will be recycled a few times to create more paper and then it will be burned for energy)
- Create cardboard packaging (this will be recycled a few times to create more paper and then it will be burned for energy)
- Create energy
- Create lumber
- Create biochar
Today, if you emit a tonne of carbon dioxide in EU, you have to pay around ~85 EUR. However, if you create biochar out of trees, you get no payment for sequestering carbon dioxide permanently. So there's no incentive to create biochar. Therefore, forest owners use forest for lumber, pulpwood (paper, cardboard, etc) and energy.
Today, for example in Finland forests have a mid-range life cycle of 80-100 years where about half of the wood chopped during the lifetime is pulpwood and half of it are sawlogs. However, if lots of people want to create wooden houses, increasing the demand and price of sawlogs, a forest owner can and will increase the life cycle of a forest to 100-120 years so that it's possible to create less pulpwood and more sawlogs. Therefore, today lumber is competing with using wood to create short-lived products like paper and cardboard, and it's also competing with burning wood for energy.
In the future, I suspect wood will be mostly used to create biochar, and in that case wooden buildings can directly compete with carbon sequestration. Therefore, I suspect the climate benefit wooden buildings today have will eventually disappear, when all wood production is being used for carbon sequestration anyway.
Also, remember that if you leave a forest unchopped, it will reach an equilibrium where all carbon flows in and out are in balance. The only way to permanently sequester carbon using a forest, is to chop it down near the time when that balance will be reached, to create room for more forest to grow, and use the wood for something that retains the carbon (lumber, biochar).
So the environmental extremists that are demanding us to leave forests unchopped are actually incorrect: if you do that, it will eventually stop carbon sequestration. If wood is used to create long-lived products, it can be a continuous carbon sink, as long as the lifetime of the products is long and the eventual waste is properly treated (i.e. used to make biochar).