PHOENIX, ARIZONA, 22 May 2008 - Any gains in construction spending for the first quarter of 2008 were outpaced by the ongoing decline in the residential construction market, according to a market commentary compiled by global construction and property consultant Rider Levett Bucknall.
For the first three months of 2008, national construction costs rose an average of 1.8%. Orlando and Boston experienced the greatest increases, showing quarterly inflation greater than 2.5%, while construction costs in Portland, Phoenix and Seattle saw less significant increases of just under 1%.
While Rider Levett Bucknall's research does provide evidence of the continued trend towards lower quarterly escalation rates in many U.S. markets, record high crude oil prices in the first quarter of 2008 have somewhat lessened the effect of the falling cost of many construction materials associated with residential projects.
Peter Knowles, Executive Vice President of Rider Levett Bucknall, commented: "The net effect on the cost of construction materials for the remainder of this year is difficult to gauge as the fall of residential construction material prices is weighed against the volatility of oil prices and the uncertainty about how much the weakness of the dollar will affect costs of imported materials-particularly cement and steel."
"However, an expected gradual decrease in 2008 construction volumes from the historically high levels of previous years is anticipated to offer some relief on selling prices."
Each quarter Rider Levett Bucknall reports on the comparative cost of construction in 12 U.S. cities, indexing them to show how costs are changing in each city in particular, and against the costs in the other 11 locations. Together with additional international and national cost compendia, the cost research is meant to equip clients with proficient and relevant information to assist in key business decisions.
To download the latest version of the Construction Cost Report, or to view past issues, visit http://www.americas.rlb.com/cost-reports.html