In its latest quarterly survey of U.S. construction costs, international property and construction cost-consultant firm Rider Levett Bucknall (RLB) reports that construction spending in the United States is on track to increase approximately 6% in 2016. Overall, the national average increase in construction costs for the quarter was approximately 1.5%.
Julian Anderson, President of RLB North America, said, “In our new report, we see continued positive news for the health of the construction industry, a slight uptick in the rate cost escalation, and a sharp decrease in the rate of construction unemployment. Looking ahead, barring a Democratic sweep of the Presidency and Congress, we do not see any big, near-term changes in either private- sector or public-sector construction activity.”
While current spending is falling short of the 20% growth seen by select segments of the industry in 2015, the outlook for the construction field as a whole is reasonably favorable. Continued low interest rates, rising consumer confidence, and healthy job growth also contribute to the guarded optimism.
Going forward, RLB sees a 5% expansion in construction spending for 2017. Based on a recent consensus forecast by the Urban Land Institute, the firm notes that past gains in activity may start to slow, suggesting the latter stages of a real estate cycle. National economic growth has been slower than previously anticipated, in part due to increasing national and international vulnerabilities. Combined with weakened domestic manufacturing output and investor uncertainty pending the results of the U.S. presidential election, these conditions may begin to create downward pressure on the construction industry in 2017.
About the Rider Levett Bucknall Quarterly Construction Cost Report
Rider Levett Bucknall reports on the comparative costs of construction in 12 U.S. cities on a quarterly basis, indexing them to show how costs are changing in each city, as well as against the costs of the other 11 locations. Together with additional international and national cost compendia, the cost research equips clients with complete and relevant information to assist in business decisions.
Related Stories
Market Data | Jul 21, 2022
Architecture Billings Index continues to stabilize but remains healthy
Architecture firms reported increasing demand for design services in June, according to a new report today from The American Institute of Architects (AIA).
Market Data | Jul 21, 2022
Despite deteriorating economic conditions, nonresidential construction spending projected to increase through 2023
Construction spending on buildings is projected to increase just over nine percent this year and another six percent in 2023, according to a new report from the American Institute of Architects (AIA).
Building Team | Jul 18, 2022
Understanding the growing design-build market
FMI’s new analysis of the design-build market forecast for the next fives years shows that this delivery method will continue to grow, despite challenges from the COVID-19 pandemic.
Market Data | Jul 1, 2022
Nonresidential construction spending slightly dips in May, says ABC
National nonresidential construction spending was down by 0.6% in May, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau.
Market Data | Jun 30, 2022
Yardi Matrix releases new national rent growth forecast
Rents in most American cities continue to rise slightly each month, but are not duplicating the rapid escalation rates exhibited in 2021.
Market Data | Jun 22, 2022
Architecture Billings Index slows but remains strong
Architecture firms reported increasing demand for design services in May, according to a new report today from The American Institute of Architects (AIA).
Building Team | Jun 17, 2022
Data analytics in design and construction: from confusion to clarity and the data-driven future
Data helps virtual design and construction (VDC) teams predict project risks and navigate change, which is especially vital in today’s fluctuating construction environment.
Market Data | Jun 15, 2022
ABC’s construction backlog rises in May; contractor confidence falters
Associated Builders and Contractors reports today that its Construction Backlog Indicator increased to nine months in May from 8.8 months in April, according to an ABC member survey conducted May 17 to June 3. The reading is up one month from May 2021.
Market Data | May 18, 2022
Architecture Billings Index moderates slightly, remains strong
For the fifteenth consecutive month architecture firms reported increasing demand for design services in April, according to a new report today from The American Institute of Architects (AIA).
Market Data | May 12, 2022
Monthly construction input prices increase in April
Construction input prices increased 0.8% in April compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data released today.
