Construction Costs on their Way Up Again

Construction 'sale' prices in U.S. coming to an end.

An Associated General Contractors analysis of the latest producer price index from the U.S. Bureau of Labor Statistics shows that construction costs are rising "at an increasing rate" and that the "limited-time sale" for construction is coming to an end.

Three essential construction commodities - copper, steel and aluminum - saw higher prices from August to September. Copper prices rose 10 percent, while steel and aluminum were up 3 percent and 2 percent respectively.

Prices for other construction materials climbed at a slower rate. Plastic construction products (up 1.2 percent), pre-stressed concrete products (1.5 percent), and iron and steel pipe and tube (1.2 percent) were all more expensive in September compared to August.

Some materials - including gypsum (down 1.2 percent) and plywood (down .3 percent) - continued to decline in price, AGC noted.

Still, "the days of construction estimates coming in 20 percent under estimate may soon be coming to an end," AGC chief economist Ken Simonson warned in a news release. "These figures serve as an important reminder that governments and developers looking for a good deal on construction should act quickly before having to pay significantly more for their projects."