Building Costs Skyrocket Over the Past 12 Months

Housing Affordability
Published

Building material costs have soared 26.1% on average over the past 12 months, according to a recent survey of single-family builders asking how much costs have increased for the same house over the last year. It’s no coincidence that this same May survey for the NAHB/Wells Fargo Housing Market Index reveals that a record number of builders reported material shortages across the board.

A plurality of builders (28%) reported that material costs increased by 20-30% over the past year. Another 15.9% indicated that costs increased by 30-40%; 5.9% said costs rose by 40-50% and 15.2% indicated that their costs had soared by 50% or more.

On average, the 12-month increase in material costs for the same house was 26.1%, by far the highest percentage cost increase ever recorded in an NAHB survey. The previous record was 6.1% in 2017.

Material availability and costs are one of several factors, including the cost of regulation and a general shortage of construction labor, limiting the supply of housing, particularly for the entry-level market where additional inventory is badly needed.

Subscribe to NAHBNow

Log in or create account to subscribe to notifications of new posts.

Log in to subscribe

Latest from NAHBNow

Awards

Oct 03, 2025

NAHB Awards Deadline Extended to Oct. 20

Interested applicants for NAHB’s prestigious award programs now have additional time to submit top projects and individuals for consideration. Don't miss your chance - apply by Monday, Oct. 20.

Sponsored Content

Oct 03, 2025

Fast Money, Fewer Headaches

Every week lost to underwriting is a week you’re not building, selling, or scaling. Delays push projects out of prime seasons, tighten cash flow, and leave crews idle. And when banks already move at their own pace, builders who aren’t prepared can get stuck at the back of the line.

View all

Latest Economic News

Economics

Oct 03, 2025

Supply-Side Cost Pressures Drove Housing as Inflation Leader in 2024

Though the rate of inflation peaked in June 2022, consumer prices continued to increase throughout 2023 and 2024 as inflation drove further price growth, according to 2024 CPI review from the Bureau of Labor Statistics.

Economics

Oct 02, 2025

Square Foot Prices Moderate in 2024

Median square foot prices for new single-family detached (SFD) homes started in 2024 grew modestly, according to NAHB’s analysis of the latest Survey of Construction (SOC) data. For custom, or contractor-built, homes, the median price was $166 per square foot of floor space, up slightly from $162 in 2023.

Economics

Oct 02, 2025

17% of NAHB Builders Built Age-Restricted Housing in 2024

Only 17% of NAHB builder members build age-restricted housing for people age 55 or older, according to 2024 Member Census. This is up two percentage points from the previous year. However, this share has remained within a narrow band (15%-17%) since the question was added to the member census in 2009.