Construction Materials Prices Fall 0.8% in August
Jim Haughey -- September 24, 2007
Year-over-year Increase in Material Inflation only 1.5%
The large August cost declines were driven by a plunge in energy prices (which has been partially reversed in September) and another round of cuts in materials orders as a consequence of the withdrawal of some lenders from residential and commercial mortgage lending. There were no significant price increases in August. Aggregate prices rose 0.6% month to month; asphalt roofing prices climbed 1.9%; and aluminum rods and bars increased 0.9%. However, none of these appears to be part of a sustained rise in price.
Facility planners and contractors now have more cost risk from accelerating wage rate gains than from higher-than-anticipated materials cost. Reed Construction Data expects the period of weak materials pricing to terminate around yearend, when total construction spending is again expanding.
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