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The cost of materials a contractor needs to put up a building zoomed 26.3 percent from June 2020 through June 2021, the Associated General Contractors of America (AGCA) reported.
Lumber prices have doubled over the period, but eased slightly since. (See “Lumber Prices Add $36,000 to Cost of New Home,” Trends Journal, 4 May 2021).
The cost of steel products gained 87.5 percent, copper and brass items 61.5 percent, aluminum items 33.2 percent, and plastic products 21.8 percent.
Increases were less for wallboard, asphalt roofing material, and insulation, which climbed 18 percent, 12.1 percent, and 10.1 percent, respectively.
The cost trucking those materials to a job site went up 15.4 percent over the 12-month span, the AGCA noted.
“Rising materials prices are making it difficult for many construction firms to benefit from the re-opening of the economy, undermining the sector’s ability to add new, high-paying jobs,” the AGCA said in a 14 July statement announcing the cost increases.
TREND FORECAST: There are numerous sides to the rise in commodity prices and how far they will move up and how low can they go. While we maintain our forecast for rising inflation, again, as evidenced with yesterday’s commodity selloff when equities sharply fell… when the equity and housing markets crash so too will inflation dramatically decline.
And for an overall view of inflation’s future, please read Gregory Mannarino’s article, “Expect Inflation to Rise Rapidly, Along with A New Feudal System.”