Home builders across the U.S. are relying on lengthy project backlogs to carry them through a transformative housing market in 2023, but as high inflation and lingering supply chain challenges continue to raise construction costs and lower profits, builder confidence is falling. Roughly 36% of builders who responded to the Associated General Contractors of America’s 2023 Construction Outlook National Survey had projects canceled or postponed in 2022 but not rescheduled due to rising costs, Construction Dive reports.
In the year ahead, backed-up supply chains will keep material costs high, while hiring will remain a lingering problem for an industry battling one of the biggest labor shortages on record.
“Supply chain issues and material cost issues will continue, and will continue to have profound effects on schedules and affordability of new projects,” said Mac Caddell, president of Caddell Construction headquartered in Montgomery, Georgia, during the webinar.
To cope in 2022, 70% of respondents accelerated purchases after winning contracts, about half turned to alternative suppliers or used alternative materials or products and 22% stockpiled items before winning contracts.
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