Construction Costs Easing

After years of skyrocketing increases, growth in residential construction costs has finally eased.

CoreLogic’s Cordell Construction Cost Index (CCCI) says the rate of growth is at its slowest annual pace in 22 years.

The Q2, 2024 CCCI, which tracks the cost to build a typical new dwelling, recorded a 0.5% rise, over the quarter, down from a 0.8% increase in the first quarter of the year.

The report says in the past financial year construction costs rose by 2.6% which was the lowest annual growth rate since March 2002.

CoreLogic Research Director Tim Lawless says the growth in costs has finally returned to be within normal margins.

"However, the price of construction is not falling and building or renovating remains almost 30% more expensive now than pre-COVID after an extended period of escalating costs," he says.

The report says the easing is likely a result of reduced pricing volatility for materials, including timbers and metal products.