Washington, D.C.—Building material costs have soared 26.1% on average over the past 12 months, according to a recent survey of single-family builders by the National Association of Home Builders (NAHB). The report showed how much costs have increased for the same house over the last year.
The NAHB said it’s no coincidence the same May survey for the NAHB/Wells Fargo Housing Market Index revealed a record number of builders reporting material shortages.
A plurality of builders (28%) reported that building 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 costs had soared by 50% or more.
On average, the 12-month increase in building material costs for the same house was 26.1%, by far the highest percentage cost increase ever recorded in an NAHB survey, the group said. The previous record was 6.1% in 2017.
According to the NAHB, 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 needed.