Wednesday, 23 February 2022 / Published in Base4

Developers: 2022 Construction Costs Update

Reading Time: 4 minutes

Building materials costs soared at a record pace last year due to pandemic-related troubles that overwhelmed global production and supply chains. According to the latest Producer Price Index (PPI) report, costs of materials are still sky-high. Here’s an updated look at building materials prices.

Building materials prices increased 20.3%, year-over-year, and have risen 28.7% since January 2020. ¹

The price index of services inputs to residential construction increased 2.9% in January following a 1.3% increase in December 2021. The index is 8.9% higher than it was the past year and 24.1% higher than January 2020.

Softwood Lumber

The PPI for softwood lumber (seasonally adjusted) increased 25.4% in January following a 21.3% increase in the past month. According to Random Lengths data, the “mill price” of framing lumber has more than tripled since late August.

Steel Products

Steel mill products prices declined 1.9% in January, the first decrease in nearly a year and a half. Even after last month’s decline, the overall price point is still double compared to one year ago.

Ready-Mix Concrete

The PPI for ready-mix concrete (RMC) gained 1.4% in January after increasing 0.6% in December. Before January 2021, year-over-year price increases had not exceeded 8.0% since December 2006.

Gypsum Products

In January, the PPI for gypsum products rose 3.4%. Gypsum products prices have gained 23.0%, year-over-year, the largest increase since data became available in 2012.

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