Decreasing Demand Keeps Construction Costs in Check

After peaking in the third quarter of 2008, overall prices for construction materials fell steadily until the latter part of 2009, when the decreases began to moderate for most materials. Nevertheless, current overall prices are still up 26 percent since 2004. Exceptions to the overall trend are copper and aluminum, which shot upward in the second half of 2009, driven in part by China’s demand for raw materials. Conversely, lumber materials have fallen more steadily and steeply than construction materials generally.

Modest demand will likely keep construction costs in check until the latter half of 2010.