Coldwell Banker Richard Ellis, the world’s largest real estate company, expects a 14.1% year-over-year increase in U.S. construction costs by the end of 2022, according to globalconstructionreview.com. The company cited financial pressures such as inflation, labor shortages, supply chain challenges, COVID-19 and Russia’s invasion of Ukraine.

The predicted increase is the largest since CBRE began making cost projections in 2007. The company expects cost inflation to fall to 4.3% in 2023 and 2.9% in 2024 as inflation issues and supply chain problems lessen. However, it says material delivery delays, labor scarcity and semiconductor shortages will persist.

“The construction industry thrives on predictability, but we continue to grapple this year with numerous challenges and volatility, making estimating and managing costs more difficult,” said Nicolas McNamara, director of cost consultancy for CBRE.

McNamara said demand for new projects remains strong, and understanding the factors affecting construction costs is key to navigating the situation.

Original Information Source:

https://www.nrca.net/RoofingNews/u-s--construction-costs-expected-to-rise-14-1-by-the-end-of-2022.8-30-2022.