Building Costs Skyrocket Over the Past 12 Months

Filed in Advocacy, Housing Affordability, Material Costs by on June 4, 2021

Building material costs have soared 26.1% on average over the past 12 months, according to a recent survey of single-family builders asking how much costs have increased for the same house over the last year. It’s no coincidence that this same May survey for the NAHB/Wells Fargo Housing Market Index reveals that a record number of builders reported material shortages across the board.

A plurality of builders (28%) reported that material costs increased by 20-30% over the past year. Another 15.9% indicated  that costs increased by 30-40%; 5.9% said costs rose by 40-50% and 15.2% indicated that their costs had soared by 50% or more.

On average, the 12-month increase in material costs for the same house was 26.1%, by far the highest percentage cost increase ever recorded in an NAHB survey. The previous record was 6.1% in 2017.

Material availability and costs are one of several factors, including the cost of regulation and a general shortage of construction labor, limiting the supply of housing, particularly for the entry-level market where additional inventory is badly needed.

NAHB Senior Economist Paul Emrath provides more analysis in this Eye on Housing blog post.

Tags: , ,

Comments (31)

Trackback URL | Comments RSS Feed

Sites That Link to this Post

  1. HAC News: June 10, 2021 – Housing Assistance Council | June 10, 2021
  2. Worth The Wait. Patience & Planning A Remodel. | HomeSquare | July 7, 2021
  3. Cost to build or renovate a home is up. Here’s why and how much – Eric Vick | July 14, 2021
  4. Price to create or renovate a house is up. Here is why and how much - Chez Elda | July 17, 2021
  5. Price to construct or renovate a home is up. Here is why and how significantly - Bradleys Quality Drycleaning | July 17, 2021
  6. What to Do About Property Improvement Delays and Shortages | mvnavidr | July 21, 2021
  7. What to Do About Home Improvement Delays and Shortages - Redingtonlongpier | July 21, 2021
  8. What to Do About Home Improvement Delays and Shortages - marthas kitchen | July 21, 2021
  9. Rising building costs could slow down new affordable housing development - Affordable Housing Online | July 21, 2021
  10. What to do in case of delays and shortages of home renovations - My-MoreThings | July 21, 2021
  11. What to Do About Home Improvement Delays and Shortages - Neo Cenicienta | July 22, 2021
  12. What to Do About Home Improvement Delays and Shortages - mypicturemania | July 22, 2021
  13. What to Do About Home Improvement Delays and Shortages - Terrades Delmoli | July 22, 2021
  14. What to Do About Dwelling Improvement Delays and Shortages | Initiative | July 24, 2021
  15. What to Do About Home Enhancement Delays and Shortages - eristart | July 25, 2021
  16. What to Do About Dwelling Advancement Delays and Shortages | nsc-olimpiyskiy | July 26, 2021
  17. Charge to build or renovate a dwelling is up. Here's why and how substantially - The Scandinavian Co | August 14, 2021
  18. Buying a Home in Today's Low Interest Rate, Competitive Market: What to Know - banknewsnow updated bank news | August 25, 2021
  19. Buying a Home in Today’s Low Interest Rate, Competitive Market: What to Know - New York Digital News | August 25, 2021
  20. Acquiring a Home in Present day Small Fascination Rate, Aggressive Sector: What to Know - RDB-Design | August 26, 2021
  21. Obtaining a Home in Modern Reduced Curiosity Level, Competitive Current market: What to Know - Bradleys Quality Drycleaning | August 28, 2021
  22. Obtaining a Residence in Modern Reduced Curiosity Charge, Aggressive Current market: What to Know - Chez Elda | September 2, 2021
  23. As Property Values Explode, Should You Increase Your Homeowners Insurance Policy Coverage? - Black News Daily | September 3, 2021
  24. Should You Increase Your Homeowner's Insurance Coverage? | Florida Insurance Claim Lawyers | September 3, 2021
  25. Acquiring a Residence in Today's Minimal Fascination Charge, Competitive Marketplace: What to Know - Greenman Paddington | September 3, 2021
  26. Cut Operating Costs While Improving Productivity: The New Construction Industry Normal—Same as it Ever Was | CMPRO™ | September 15, 2021
  1. Paul McGovern says:

    Why say “over the past 12 months” when it has actually occurred over the past 7 months … just since Biden was “elected/appointed” President ?

    • Brian Popiel says:

      Because that isn’t remotely close to the truth. Lumber has been spiking for a year. I had multiple price increases on roofing, drywall, steel, and of course labor well in advance of Election Day.

      NAHB has to work with politicians on both sides of the aisle, so if they become ideologues its impossible for them to represent their membership.

  2. Chester Carthel says:

    Quite the deceptive headline, “Building Costs Skyrocket over the Past 12 Months.” Yet, the chart indicates it’s really since the last seven months with exponential increases since Nov. 2020.

  3. Virgil Wulfson says:

    There is so much discussion of lumber price increases that other material cost increases are being overlooked. Trim prices have as much as doubled on many items, and are in very short supply, interior door prices have gone up 50%+, appliances are still in short supply and are going up, drywall materials are on the increase, and many other materials to a lesser extent. Rising fuel cost are also causing increased cost across the board.

  4. robin says:

    Not only have the prices increased, but once again, we are running into shortages..ie, wood mouldings