BNi Building News Construction Costs November 2023
Posted: November 2, 2023 | Cost Trends
Source: US Department of Labor, Producer Price Index
The housing market is moving but still down; it’s not dead but until mortgage rates work their way down it most likely won’t get better. Housing is down 10%. Housing priced below $400,000 is still selling and builders in appropriate markets are building. The commercial sector is another story, almost all sectors are up, averaging a 15% increase, with some extraordinary sectors such as manufacturing up over 60%. The infrastructure program is still kicking in and up 12-15%. Contractors report backlogs but not as dramatic as last year, and most materials are readily available.
Again, material prices are up and down, so watching the markets is a must. At the time of publication, oil is in a downward direction and inflation was slowing but last month showed an increase. Materials are moderating but with some crazy numbers out there. As a result, we must continue to watch material prices closely. The labor market is also a concern, so after years of 1-1/2 to 2% increases we are seeing more rate increases in the 3 to 4% range.