According to Associated General Contractors of America (AGC), in the past two years, construction costs appear to be rising faster than the general rate of inflation.
Heavy construction in the U.S. and rapid growth in Asia have created a strong demand for a number of construction materials.
"The impact of the hurricanes has shown up most dramatically in the cost of diesel fuel and natural gas," says Ken Simonson, chief economist for AGC.
Inflation of diesel fuel impacts contractors most. "It's important to contractors because not only do they use diesel fuel to power their own construction trucks, concrete mixers and cranes, they also pay a fuel surcharge on deliveries to their job sites," Simonson says.
Simonson recommends coping with inflation prices by staying in contact with suppliers and keeping the homebuyer informed.
| Percentage change in 12 months ending | Sept. 2004 | Sept. 2005 |
| #2 Diesel Fuel | 54.7 | 50.9 |
| Asphalt | 11.6 | 15.1 |
| Paving Mixtures & Blocks | 2.9 | 10.5 |
| Concrete Products | 7 | 10 |
| Concrete Block & Brick | 4.8 | 8 |
| Concrete Pipe | 4.4 | 4.3 |
| Ready-mixed Concrete | 7.8 | 12.3 |
| Precast Concrete Products | 6.3 | 6.5 |
| Prestressed Concrete Products | 7.6 | 4.5 |
| Brick & Structural Clay Tile | 3.1 | 5.2 |
| Asphalt Felts & Coatings | 2.1 | 13.2 |
| Gypsum Products | 20.8 | 12.7 |
| Insulation Materials | 11.2 | -0.3 |
| Plastic Construction Products | 6.3 | 5.4 |
| Lumber & Plywood | 16.5 | -8.5 |
| Steel Mill Products | 48.2 | -5.5 |
| Hot-rolled Bars, Plates & Structural Shapes | 61 | -2 |
| Steel Pipe & Tube | 66 | 0.3 |
| Copper & Brass Mill Shapes | 32.2 | 19.2 |
| Aluminum Mill Shapes | 7.5 | 5.6 |
| Structural, Architectural, Pre-Engineered Metal Products | 24.1 | 3.5 |
| Fabricated Structural Metal | 23.7 | 3.5 |
| Fabricated Structural Metal for Buildings | 18.9 | 3.4 |
| Architectural & Ornamental Metalwork | 24 | 1.8 |
| Fabricated Iron & Steel Pipe, Tube & Fittings | 30.8 | 3.6 |
| Nonferrous Pipe, Tube & Fittings | 2 | 12.8 |
| Fabricated Steel Plate | 11.5 | -5.7 |
| Prefabricated Metal Buildings | 32.9 | 1.8 |
| Construction Machinery & Equipment | 3.9 | 6.7 |
| Source: Associated General Contractors of America | ||
Advertisement
Related Stories
Hamlet Homes' Mike Brodsky on Finding Successors and Letting Go
A transition that involved a national executive search, an employee buyout, and Builder 20 group mentorship to save the deal
Time-Machine Lessons
We ask custom builders: If you could redo your first house or revisit the first years of running your business, what would you do differently?
Back Story: Green Gables Opens Up Every Aspect of its Design/Build Process to Clients
"You never want to get to the next phase and realize somebody's not happy."
