Construction material prices decreased 0.1% in September but are up 16.3% on a year-over-year basis, according to www.abc.org.
Nonresidential construction material prices fell 0.1% from August to September but increased 15.9% compared with one year ago. Prices were down in six of 11 subcategories. Softwood lumber prices are up 14.5% year-over-year and down 4.6% from August to September. Iron and steel prices are down 12.8% year-over-year and 5.4% for the month. Natural gas rose 3.1% from August to September and is up 497.6% since February 2020. Crude petroleum fell 3.4% for the month and is up 84.3% since February 2020.
“Investors and other stakeholders are eagerly awaiting any indications of meaningful declines in inflationary pressures,” said ABC Chief Economist Anirban Basu. “Elevated inflation and interest rate increases have not only undone momentum in America’s homebuilding industry but also threaten the entire global economy. There are already indications of growing financial stress, including at banking giant Credit Suisse. This is bad news for the heavily financed real estate and construction segments.
“While many American nonresidential contractors remain upbeat, according to ABC’s Construction Confidence Index, there are significant threats looming over the industry,” Basu continued. “Next year stands to be a weak one for the U.S. economy as it continues to absorb the impacts of rapidly rising borrowing costs.”