I recently found this in a post on the Preservation Beekeeping Community Page.
"Western Red Cedar is more than just a beautiful wood to look at. It has several physical qualities making it an excellent material to make bee homes with. Cedar is a wood with a very low density. Low density means a high proportion of air spaces, which makes Cedar the best thermal insulator of all our common building wood. It has a 1 ½ to 2 times better insulating value than other woods. A hive with a higher insulated value assists the bees in managing the warming and cooling duties preformed by the bees in the hive.
A low density also makes Cedar more dimensionally stable, shrinking and swelling less in a wet climate. That’s not to say that it doesn’t shrink or swell at all, it just doesn’t do it as much as other woods.
Another property of Cedar that makes it a good hive building material is that it is hygroscopic. Meaning that the wood will absorb and expel moisture trying to balance with its surrounding environment. When I talk about this I say, “Cedar can breathe”.
The natural preservative properties in Cedar wood means it can also absorb high levels of moisture without developing mold and fungus growth. Being hygroscopic and resistant to mold and fungus is a good quality to have inside a bee hive because of the high levels of humidity and condensation the bees can produce.
My experience building and using Cedar hives is that they do take bee housing to a different level for both the keeper and the bees. Personally I refer to Cedar hives as 'Bee Homes.'"
Credit to Armin E. Schmidt Ernie