10 Inflation Price Hikes That Will Increase the Cost of Your Home Projects This Year
The price of building supplies continue to rise, impacting the cost of renovations and causing homeowner headaches.
While some industries are beginning to rebound from the Covid-19 pandemic, the home improvement trade continues to struggle. Between ongoing labor shortages and supply chain issues, prices for home renovation projects keep rising.
According to the recent consumer price index released by the U.S. Bureau of Labor Statistics (BLS) in March 2022, inflation rates for consumer items rose at a rate of 7.9 percent between February 2021 to February 2022—the most significant increase in more than 40 years. This rise is apparent across various product categories in the home improvement sector, causing expenses for construction projects to skyrocket.
Building material costs rose 31.3 percent from early 2020 to early 2022, with the index climbing 10.6 percent in the past 5 months. Statistics from housing and home improvement organizations, the BLS, and the Associated General Contractors of America paint a clear picture that these 10 materials continue to add dollars to remodeling budgets.
If you’re laying a concrete foundation or floors in a home building project, expect to pay more than in previous years. The cost of concrete products has been steadily increasing since early in the pandemic. In 2021, the producer price index increased by 7.6 percent, growing another 4 percent just a few months into 2022. Concrete block and brick saw a rise of 2.8 percent over a couple of months, and the price of ready-mix concrete increased 3.2 percent from fall 2021 to February 2022.
Gypsum products (which include ceiling tiles, plaster, and drywall) are an integral part of most remodeling projects and continue to contribute to rising home renovation budgets. Though gypsum product prices saw a decline of 1.3 percent at the beginning of 2022, they were up 20.7 percent in just 12 months.
It’s now common knowledge that lumber availability and prices are a top concern for renovation projects due to increased demand, supply chain issues, labor shortages, and high tariffs. According to the National Association of Home Builders, lumber costs increased the price of a single home build by more than $18,600 from fall 2021 to January 2022. Thanks to increasing Canadian lumber tariffs, softwood prices especially have continued to climb, increasing 79.5 percent in cost from September 2021 to January 2022.
You may want to consider the high cost of steel in your home improvement budget. Up 74.4 percent in price since 2021, this material’s price has also been hit particularly hard. However, there is some good news: While steel mill products such as framing and roofs still cost more than in previous years, prices in the category have declined since the beginning of 2022. Costs fell 9.9 percent in February alone.
Even simple painting projects will cost more than in 2021. Though the numbers remained stable in February 2022, the price increased 30.3 percent for exterior paint and 21.2 percent for interior products in a single year. The price of architectural coatings also went up 20.3 percent from 2021 to 2022.
6. Insulation Materials
New and remodeled interior spaces will need insulation to keep home interiors energy efficient, and that will cost you more, too. Up 17.8 percent from early 2021—with a 5.4 percent increase since November—various insulation products continue to show an increase in overall cost.
7. Plastic Construction Materials
Plastic construction materials are common in today’s building projects, showing up in various applications, including pipes, seals, windows, doors, and more. Unfortunately, this category leapt in price by 35.6 percent between early 2021 and early 2022. The cost jumped 4.4 percent in November 2021, and it went up another 1.3 percent in January 2022 alone.
If you plan to spend this year’s remodeling budget on redecorating your interior, be sure to consider the rising cost of furniture. According to the BLS, the cost of living room, kitchen, and dining room furniture went up an average of 2 percent per month for a total change (unadjusted for seasonal increases) of 19.9 percent in a year.
While kitchen remodels are already one of the most expensive interior renovation projects, a hike in appliance costs won’t help your bottom line. According to recent data, appliance prices are up 7.3 percent in one year. This includes kitchen appliances, as well as washers and dryers and other major home equipment.
10. Hardware and Tools
Don’t forget the cost of nuts and bolts, as well as tools and other supplies. Building hardware and tool prices continued to rise throughout 2021 and most recently saw an increase of 8.7 percent from February 2021 to one year later, according to the BLS.
How to Save
With the rising costs of everything from groceries to home renovation supplies, it’s more important than ever to find ways to save where you can. Here are five quick tips:
- Get multiple bids for projects.
- Opt for a home facelift instead of a complete renovation overhaul.
- Do your own demolition.
- Watch for sales, take advantage of price matching, and buy appliances secondhand.
- Reserve some of your budget for the unexpected.