Residential Construction Materials Prices

Construction materials prices continued to increase during July, August, and September of 2022. However, the increase has been much slower than in previous quarters of this year. According to the MCP Group, construction cost growth is “expected to be 1% – 2% per month for the remainder of 2022,” while “relief may not be in sight until early 2023.” Below are some key insights into the market for construction materials during the third quarter of 2022. 

• Lumber: Lumber prices dropped slightly in the third quarter, continuing the trend that the country has been seeing since March. The price per 1,000 board feet dropped from $600 to just over $500.
• Steel: Steel prices rose slightly during Q3 but overall appeared to have a constant trend since July. 
• Paint: The price of paint saw a slight increase from July to September of 2022, rising about 1.5%. 
• Concrete: All signs point to subtle increases in the price of concrete for the third quarter as well. One of the biggest suppliers of concrete in the country saw a 4.2% increase in price during Q3.  
• Glass: Following the trend of other construction materials for this quarter, glass also saw a slight price increase. Between July and September of 2022, the price of glass rose just under two percentage points. 
• Gypsum: Gypsum has steadily been going up in price for years. Lately, prices have been increasing sharply, and Q3 was no different.
• Plastics: Plastic prices dipped in Q3 but have remained relatively stable over the past year.

High prices aren’t entirely done yet, but they are slowing down. If you’ve been thinking about building a custom home, keep your eyes on the market to make sure you don’t miss your chance!

It’s also important to remember the biggest cost when building a custom home: land! Depending on where you’re building, the cost of land can vary. In Prescott, there are a variety of plots still available. They offer spectacular views and come at a reasonable price.

Residential Construction Labor Costs

Building a home isn’t just about the materials. You need to pay laborers to get the work done. If you’ve been paying attention to the U.S. economy, you’re well aware that labor costs are increasing, and finding people to work is even more challenging.

While there was a severe shortage of construction labor work during the past months, levels seem to be returning to normal. Still, it’s hard to find workers for many open positions. Most experts also believe that the cost of construction labor will continue to increase.

The Economy

Experts continue to argue whether the US is in a recession or not. While inflation is rising and GDP growth is slow, there continue to be a number of job openings available. Many people think we are already in a recession because people are feeling financially strapped. Still, most experts believe that things will start looking better in the coming months. 

Looking at the residential construction market, fewer people chose to start a custom home project in the third quarter. Still, the difference between Q2 and Q3 was not drastic.

Conclusion

The residential construction market is slowing down and will likely continue to do so in the coming months. If you’ve been considering building a custom home in Prescott, Arizona, now is the perfect time to take advantage of slowed-down pricing to create your dream home. 

Call our office today (928-776-0301)  to discuss your project and check back here to get the latest numbers.