Although ENR’s cost indexes measure the costs of non-residential buildings, the stalled recovery in the housing market still had a major impact on index movement. After falling 27% over the previous five years, lumber prices spiked in the first quarter of last year as federal tax credits boosted the depressed housing market. But lumber prices faded as the housing recovery stalled, ending the first quarter of this year about 4% above 2010’s level. In addition, steel prices also spiked in 2010. Related Links: Economics: Japan Quake Won�t Shake Up Costs as Recession Trumps Rising Prices Confidence Survey: Top Industry Execs
The market is generally healthy and steadily growing, and margins are up for large specialty contractors. Further, advances in design tools and owner demand for collaboration are giving subcontractors a seat at the table early on in projects.