So how bad was 2021 cost-wise?

[puntloos]

So, we've gracefully exited 2021 now. Was wondering as the title says:

How much did build cost estimates go up over 2021? (e.g. tendering 'today' vs tendering 'last year', everything else being equal)

 

And are there any outliers? E.g. "wood went up 300%, while the rest of the prices are only 5% more"?

 

 

Edited February 5, 2022 by puntloos

[nod]

I think the labour is about the same 

Some materials up

But others like timber falling quickly 

[puntloos]

1 hour ago, nod said:

I think the labour is about the same 

Some materials up

But others like timber falling quickly 

 

One builder told me it has always been that way anyway (pre-covid), material costs vary a ton, but there's always one (group of) things that is unusually high.

 

I'm sure covid raised the 'overall price' by more than you would expect (which is my question - 15% then?), but I think we're behind the big peak.

 

Edited February 5, 2022 by puntloos

[Dave Jones]

[puntloos]

Interesting. And what % of build cost is materials? I imagine 66%? 

 

So if build 2020 is 500,000 then that would be 333,333 materials, 166,666 for labour

 

-> build 2021 333,333 * 1.215 = 404,999.595 + 166,666 = 571,665 - that's about 15% 

 

Of course there's always some generic inflation etc, but I can probably keep it under 20% then?

 

 

[Dave Jones]

labour hasnt moved much at all in my experience, materials ......

[markc]

1 minute ago, Dave Jones said:

labour hasnt moved much at all in my experience, materials ......

Availability has which has lead to some over charging but generally labour costs across most industries have stayed pretty level

[ProDave]

39 minutes ago, Dave Jones said:

labour hasnt moved much at all in my experience, materials ......

Not yet, but in view of the vast increases in the cost of living, I am on the verge of putting mine up 7.5%  (it;s some years since it last went up)  I can't be the only one?

[puntloos]

15 minutes ago, ProDave said:

Not yet, but in view of the vast increases in the cost of living, I am on the verge of putting mine up 7.5%  (it;s some years since it last went up)  I can't be the only one?

Ha so this is one of the golden moments where some potential client should come to your table dressed in rags and looking desparate, hide the rolex watch

 

Seriously though, 7.5%, while selfishly I'm not a fan, I can't really fault you for it. Do you somewhat agree with the other side of it? 20-odd% for materials overall? If you tendered for 500,000 last Jan, and the client put things on pause for a year, what would you ask today? 

 

333,333 * 1.215  + 1666,6666 * 1.075= 404,999.595 + 179,165 = 584,184 (17% increase)?

 

Edited February 5, 2022 by puntloos

[ProDave]

I find it hard to quantify material rises last year.  Most of what I was buying was timber, and it was not just the cost, but for much of the year timber was simply hard to find and it was a case of get whatever I could from whichever merchant had it.  No chance to play them off against each other to get the best price when only one of them had it and they knew they were the only one.

[nod]

2 hours ago, puntloos said:

 

One builder told me it has always been that way anyway (pre-covid), material costs vary a ton, but there's always one (group of) things that is unusually high.

 

I'm sure covid raised the 'overall price' by more than you would expect (which is my question - 15% then?), but I think we're behind the big peak.

 

2008 I and others dropped there rates 

by 30% and there they stayed for five years 

So recent labour costs have only caught up what was lost and the lack of increase’s 

In forty years running my own building business I’ve never known materials go up at these rates 

So much so ALL the fixed priced sites I price Allow for the usual annual 5% material rise With the main contractor- Client Agreeing to pick up anything above 5% 

Without this written agreement Something I’ve never had before I and others including the main contractors would go out of business 

 

ALL self builders must bare this in mind when entering into a fixed contract Or risk the builder going bust or pulling off part way through 

 

Hopefully we are past the worst 

But who knows 

Some contractors where reducing there labour rates last October Only to put them back up in December 

I get paid every 60 days Most of the house builders are now paying there Brickaying contractors Brick barons as they are known round here On a weekly basis 

Its causing cash flow problems But they have no choice

It won’t last 

 

I spoken to a friend One of these new brick Barons with forty plus Brickies working for him He doesn’t have an office or a QS 

Or any plant Just a small van 

But he holds all the cards 

Ive asked him for a couple of gangs and reminded him that I’ve helped him over the years His reply was they will need an incentive We know what that is 

They won’t do the setting out and arnt keen on doing the foundations 

So it looks like the same as last time I’ll do the foundations for the house and workshop BB Load it all up 

Supply planks trestles and a site mixer 

Then I can have two gangs 

and that’s a big favor at the moment 

While we are in Northern England 

Manchester and Liverpool are only 30 minutes away and dictate the rates 

 

Just a sample that  could help others with there budgeting 

 

 

Edited February 5, 2022 by nod

[SimonD]

3 hours ago, ProDave said:

and it was a case of get whatever I could from whichever merchant had it.  No chance to play them off against each other to get the best price when only one of them had it and they knew they were the only one.

 

Absolutely, it took me 3 months to get a load of 25 x 50 battens earlier in the year. Because I wasn't a regular trade customer, the local suppliers just said they couldn't supply me because next weeks supply was already promised to the regulars. When I did finaly get some the lad on the phone asked for £1.16/m and I reminded him who I normally dealt with along with how much I'd spent with them the last year and they dropped the price to 76p/m and that was up from 42p.

 

For me, it's not just the product price inflation, but also supply. I've been having problems with everything from silly things like not getting the stainless steel screws I need for several weeks, to many larger things being out of stock so I'm either having to change design to get on with things, or just wait it out. I know some others near me building who ordered some materials for their project last May and have been given estimated fulfilment this coming May, but that's still uncomfirmed.

 

Re labour rates around us, the large developers have had to up their day rates to equivalent of retail rates to get the trades in for their projects, which tightens supply for everyone else, but this has actually been going on since before COVID and Brexit but has experienced an extra squeeze. A mate of mine based in London who does foundation work said business is absolutely booming because so many builders have left the country now.

[nod]

9 hours ago, SimonD said:

 

Absolutely, it took me 3 months to get a load of 25 x 50 battens earlier in the year. Because I wasn't a regular trade customer, the local suppliers just said they couldn't supply me because next weeks supply was already promised to the regulars. When I did finaly get some the lad on the phone asked for £1.16/m and I reminded him who I normally dealt with along with how much I'd spent with them the last year and they dropped the price to 76p/m and that was up from 42p.

 

For me, it's not just the product price inflation, but also supply. I've been having problems with everything from silly things like not getting the stainless steel screws I need for several weeks, to many larger things being out of stock so I'm either having to change design to get on with things, or just wait it out. I know some others near me building who ordered some materials for their project last May and have been given estimated fulfilment this coming May, but that's still uncomfirmed.

 

Re labour rates around us, the large developers have had to up their day rates to equivalent of retail rates to get the trades in for their projects, which tightens supply for everyone else, but this has actually been going on since before COVID and Brexit but has experienced an extra squeeze. A mate of mine based in London who does foundation work said business is absolutely booming because so many builders have left the country now.

Yep BMs are doing this 

Local to me we are being told that the Weinerberger bricks we wanted are on back order till December 

I called in ply to find over a hundred thousand in stock 

Ring fenced for a major house builder 

When I pointed out that I’d had an account with them for over 20 years 

They ring fenced 7500 for me 

It’s a ridiculous situation when builders are ordering materials that they have nowhere to put them 

Parking on most sites is a nightmare As most are stocked with timber bricks Batons Roof tiles 

Materials that won’t be used this side of Easter 

It’s very like the short lived fuel shortage a couple of months back 

 

[puntloos]

21 hours ago, ProDave said:

I find it hard to quantify material rises last year.  Most of what I was buying was timber, and it was not just the cost, but for much of the year timber was simply hard to find and it was a case of get whatever I could from whichever merchant had it.  No chance to play them off against each other to get the best price when only one of them had it and they knew they were the only one.

 

 

Interesting point, but is that fact reflected in the BEIS prices that @Dave Jones quoted? It's all well and good if the "sawmills" have increased their prices by 21%, but if this one shop that actually has the wood raises their asking price far beyond that since desperate builders will pay it.. is the real price more like 30% extra?

 

Or is that 21% the effective price after all the theoretical 'gauging' that happens? 

[SuperJohnG]

I thought we'd seen the back of mega prices....after starting my build 2 months before the pandemic. 

 

Just went in to get two full inspections chambers from PDM....£63 last January now £158. Mental. 

[Eric]

My Scotframe kit has gone up by 25% from last year…..

[nod]

Getting worse 

[SuperJohnG]

1 hour ago, Eric said:

My Scotframe kit has gone up by 25% from last year…..

That's actually not that bad considering.  Get it bought now...

[SuperJohnG]

1 hour ago, nod said:

Getting worse 

Fuel prices is just going to drive so much costs now. What a crazy time to be in...brexit...covid....war/ energy cap prices..and so it goes 

[nod]

1 hour ago, SuperJohnG said:

Fuel prices is just going to drive so much costs now. What a crazy time to be in...brexit...covid....war/ energy cap prices..and so it goes 

Many many suppliers are milking it 

9p a liter difference between two independent garages 

 

lintel quite over a grand difference between two quotes 

same product 

 

BB 1400 difference between two quotes both selling  Armstrong beams 

 

[Eric]

4 hours ago, SuperJohnG said:

That's actually not that bad considering.  Get it bought now...

It’s on order, 375 m2 so it’s expensive, no windows, no stair case etc.

[AliG]

Basically build costs are up about 20% over the last year.

 

Big increases in insulation prices, so it becomes chicken and egg. More insulation is needed when energy costs go up, but insulation needs energy to make so it is also up in price.

 

Build costs are surely one of the big drivers behind house price inflation. Much as I think house prices have peaked and need to fall because of cost of living increases, builders need prices to stay up to cover cost increases.

 

What really has to fall in price is land. A plot in my street just came up at offer over £650k. I assume they want 700. I would expect them to get it as self build plots are so hard to come by. We had someone put a letter through the door offering to buy my parents' plot as we hadn't started building.

 

My suspicion is that people are overpaying for plots as they are not correctly factoring in rising build costs. Land if anything should've fallen in price as build costs have been rising much faster than house prices recently.

[ProDave]

1 hour ago, AliG said:

What really has to fall in price is land. A plot in my street just came up at offer over £650k. I assume they want 700. I would expect them to get it as self build plots are so hard to come by. We had someone put a letter through the door offering to buy my parents' plot as we hadn't started building.

 

So plots there are 10* the cost of plots here, which is insane as built houses are not 10*

[jayc89]

1 hour ago, ProDave said:

So plots there are 10* the cost of plots here, which is insane as built houses are not 10*

 

I don't remember the last time I saw a plot around me for less than £250k. We have family in the Scottish Borders and you can get a pretty impressive chunk of land, with stunning views, for that sort of money up there! 

[AliG]

4 hours ago, ProDave said:

So plots there are 10* the cost of plots here, which is insane as built houses are not 10*

Houses in this street would go for around £500 a square foot, one of the highest in Edinburgh for houses, and it has permission for a 3700sq ft house. Really weird design though, I'll post the ground floor. It would probably be worth around £1.5m (Value per sq foot falls over 3000sq ft, plus the odd design).

 

It's a 0.22acre plot, same size as my parents' but we only have permission for 2000sq ft  and paid half as much three years ago.

 

A house with the same size of plot in the next street was just sold for £715k and they are knocking it down to build around a 2500sq ft house. They have paid way over the odds I think. This would suggest even £800k is doable for the site.