How much is everything from wood to cement costing, and will material prices reduce in 2025?
In this article we cover:
- Where are material prices heading?
- Will costs reduce
- What’s causing price fluctuations
What way are material prices these days? Will they ever come back down?
Keith says: Still high and unlikely to reduce in the medium term
The Society of Chartered Surveyors Ireland’s latest construction tender price data at the time of going to print was for the first half of 2024. In that report the SCSI outlines that tender prices increased by 1.5 per cent.
Whilst many seek to highlight material prices dropping, what is clear on the ground in construction is that whilst prices are generally not running at the high increases that they once were, there is no evidence that they are dropping and are at best just levelling off.
In some respects, they continue to rise with increases still occurring in plasterboard, concrete and stone products. In the 12 months between June 2023 and June 2024, the Central Statistics Office wholesale price index, which measures movements in materials costs, shows plasterboard increasing by 3 per cent, insulation by 2 per cent, concrete by 11 per cent and blocks by 11 per cent.
We do see costs falling in timber products, including plywood, and in steel but given the heights those products reached in the period post-Covid, it is not surprising that we see downward movement there. But the magnitude of the decrease is not coming close to the increases of the past.
Many in the market question why materials costs have not gone down at the counter in the various builder’s merchants. Very often shipping and transport costs are given as the reason. Both are still high in relative terms to what they once were but at the same time we see the highest recorded profits across the majority of the builder’s merchants in Ireland which would raise questions as to the real reasons behind the slow pace of material cost reductions.
It should be noted that the picture in Ireland very much appears to mirror that in international markets with costs in construction continuing to rise. The question around if we will ever see material costs reduce is one akin to having the power to guess the lottery numbers, but the reality is that there is no sign that they will in the medium term. Sadly,without a reduction, constructing one’s dream home will for many, not become a reality.
