Archive for building material prices

Building material prices continue to rise

Single-family housing starts in 2010 totaled 475,000 – a 7 percent increase over 2009 but still substantially below the 1,256,000 average starts per year from 1995 through 2003.  .Think the decrease in demand for new home construction has resulted in lower prices for building materials.  Think again.

Prices for materials used in construction actually increased 5.4 percent in all of 2010.  Prices increased at double-digit rates over the year for four key construction materials. Diesel fuel prices climbed 28 percent in 2010; steel mill product prices rose 12.5 percent (think rebar, nails, kitchen sinks, appliances, etc.); copper and brass mill shape prices were up 12 percent (think electrical wiring, water supply valves and fittings); and prices for aluminum mill shapes rose 12 percent over the year.  Other items that contributed to the climb included lumber and plywood, 5.7 percent; architectural coatings, primarily paint, 1.5 percent; brick and structural clay tile, 1.0 percent; gypsum products, 3.4 percent; asphalt, 4.6 percent; and insulation materials, 4.4 percent.  The National Association of Home Builders predicts single-family housing starts will increase 21 percent to 575,000 in 2011.  Although the demand for construction in the United States will remain relatively weak, the price increases are likely to intensify in 2011 as global demand for construction materials grows.

Have you been waiting to build your new home or remodel your existing home hoping prices will continue to fall?  You might have already waited too long.

Chuck Miller GMB   CGB  CGP  CAPS  MIRM   CMP   MCSP   CSP

President / Builder – Chuck Miller Construction Inc.

(208) 229-2553

chuck@chuckmillerconstruction.com

Posted in: building, building material prices, cost of building, Remodeling

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Building material prices edge up again

Think the decrease in demand for new home construction is resulting in lower prices for building materials.  Think again.

According to the September 16 producer price index (PPI) report by the U.S. Labor Department, prices for construction materials edged up 0.2% in August. Prices are 3.6% higher than one year ago.

Nonferrous wire and cable prices increased 1.8% for the month and are up 8.7% compared to August 2009. Prices for plumbing fixtures and fittings were up 0.6% in August and up 1.2% from the same time last year. Prices for concrete products inched up 0.5% for the month, but are down 1.1% from August 2009 levels.

Softwood lumber prices slid for a third straight month, down 3.1% in August. However, prices are still 6.8% higher on a year-over-year basis. Iron and steel prices were down 1.5% in August, the third straight monthly price decrease. But, prices are still 18.2% higher than they were one year ago. Steel mill product prices were down 3.9% August, but were still up 17.1% from last August. Prepared asphalt, tar roofing and siding prices slipped 0.9% in August, but were up 8.6% over the last twelve months. Prices for fabricated structural metal products decreased 0.2% for the month, but were up 2.8% compared to August 2009.

Overall, the nation’s wholesale prices increased 0.4% last month and are 3.1 percent higher from August 2009.

Are you waiting for the price of that new home you’d like to build to drop further?  I wouldn’t.

Chuck Miller GMB   CGB  CGP   MIRM   CMP   MCSP   CSP

President / Builder – Chuck Miller Construction Inc.

(208) 229-2553

chuck@chuckmillerconstruction.com

Posted in: building, building material prices, cost of building, home building

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Inflation Trends and Building Material Prices

For the past five months (September 2009 through January 2010), the Consumer Price Index (CPI) has risen 0.2% per month. Building materials prices are an exception to general inflation trends, which appear to be tame.

On a year-over-year basis, the Consumer Price Index (CPI) is up 2.6%. Excluding food and energy, the index is up 1.6% from a year ago. A broader measure of inflation used by the Federal Reserve — the price index for personal consumption expenditures excluding food and energy — rose 1.6% in the fourth quarter at a seasonally adjusted annual rate and 1.5% from fourth quarter 2008.

However, an index produced by the Bureau of Labor Statistics that tracks building material prices for builders of single-family homes and multifamily structures has now risen three months in a row.

Although on a year-over-year basis, the single-family index is up only 0.3% and the multifamily index is up a slight 0.2%, in January, both measures jumped 1.0% from December. Chief contributors to the recent rise are lumber, fuel products (gasoline and diesel), plumbing fixtures and copper products.

With a number of countries around the world on the expansion path, building material prices are likely to continue to rise in coming months.

The recent earthquake in Chile will disrupt supplies of some imported building materials — in particular, moldings and door frames. These items can be, and likely will be, replaced by items from other countries, but at a higher price. But Chile is also a major exporter of copper, and although the mines escaped direct damage, operations and shipping will likely be delayed as the country recovers. So far, copper prices on the COMEX are up about 4% since the quake.

Are you waiting for the price of that new home you’d like to build to drop further?  I wouldn’t.

Chuck Miller GMB   CGB  CGP   MIRM   CMP   MCSP   CSP

President / Builder – Chuck Miller Construction Inc.

(208) 229-2553

chuck@chuckmillerconstruction.com

Posted in: building, building material prices, cost of building, home building, real estate

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