Materials Prices Post Record Year-to-Date Increase

Material Costs
Published

According to the Bureau of Labor Statistics’ latest Producer Price Index (PPI) report, the prices of goods used in residential construction (excluding energy) climbed 0.8% in October, following two months of declines. Building material prices have increased 12.2% year to date, after climbing 4.5% over the same period in 2020.

Specific increases include:

  • Softwood lumber increased 9.1% in October (seasonally adjusted) — its first monthly increase since May.
  • Ready-mix concrete climbed 0.6% in October after falling 0.5% in September, and is up 4.8% year to date — its largest year-to-date increase in October since 2006.
  • Gypsum products increased 2.1% in October — its eighth consecutive monthly increase. Prices have increased 19% year to date.
  • Steel mill products experienced a smaller gain than the previous two months with a 4.8% increase in October, but prices are still up 116.9% year to date.

Prices for services, meanwhile, have decreased for the fourth consecutive month by a total of 10.5% over that time period. The decline can be attributed to a 14.6% drop in the wholesale and retail indexes, which account for roughly two-thirds of the PPI for “inputs to residential construction, services.”

The trade services PPI measures changes in the nominal gross margins for goods sold by retailers and wholesalers, of which hardware and building materials retailers comprise most of the trade services included as residential construction inputs.

The PPI for building materials retailers decreased 2.6% in October, while nominal gross margins for building materials wholesalers increased 4.8%.

David Logan, NAHB director of tax and trade policy analysis, provides more in this Eye on Housing post.

Subscribe to NAHBNow

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

Log in to subscribe

Latest from NAHBNow

Advocacy

Oct 22, 2025

NAHB Recommends Permitting Improvements to EPA and Corps

On Oct. 16, NAHB met with political leadership from the Environmental Protection Agency (EPA) and U.S. Army Corps of Engineers (the Corps) to discuss the agencies’ regulatory priorities for 2026 and beyond.

Advocacy

Oct 21, 2025

Senate Panel Passes NAHB-Backed Forestry Bill

The Senate, Agriculture, Nutrition and Forestry Committee today advanced the Fix Our Forest Act, NAHB-supported legislation that will contribute to better forest management practices, help strengthen the nation’s housing supply chain and promote affordable housing opportunities for all Americans.

View all

Latest Economic News

Economics

Oct 20, 2025

Non-Conventional Financing for New Home Sales Loses Ground in 2024

Nationwide, the share of non-conventional financing for new home sales accounted for 31% of the market per NAHB analysis of the 2024 Census Bureau Survey of Construction (SOC) data. This is 1.7 percentage point lower than the 2023 share of 32.4%. As in previous years, conventional financing dominated the market at 69.3% of sales, higher than the 2023 share of 67.6%.

Economics

Oct 17, 2025

Better Growth, Larger Deficits: CBO Fiscal Outlook

The Congressional Budget Office (CBO) is a key nonpartisan score keeper that measures the effects of policy changes by the Federal Government. With several policy changes since January of this year, including the One Big Beautiful Bill Act (OBBBA), stricter immigration, and higher tariffs, the CBO updated its economic projections through 2028.

Economics

Oct 16, 2025

Amid Market Challenges, Builder Expectations Rise in October

Even as builders continue to grapple with market and macroeconomic uncertainty, sentiment levels posted a solid gain in October as future sales expectations surpassed the 50-point breakeven mark for the first time since last January.