Building Materials Price Growth Plummets in 2023
According to the latest Producer Price Index (PPI) report, growth in the average price level of inputs to residential construction less energy (i.e., building materials) fell from 15% in 2022 to 1.3% in 2023 (not seasonally adjusted). On a monthly basis, building materials prices rose 0.1% in December after increasing 0.1% in November (revised). Monthly price increases averaged 0.2% in 2023, down from 1.5% in 2021 and 0.7% in 2022.
Here is a breakdown by building material:
Softwood Lumber: The PPI for softwood lumber (seasonally adjusted) declined 2.3% in December, the third consecutive decrease and the fourth over the past five months. The index has fallen 14.5% since reaching its 2023 high in July.
On an annual basis, prices declined 31.3% in 2023 after falling 3.2% in 2022. Although the 33.5% two-year decrease is massive in historical terms, prices remain 22.7% above the 2019 level as the index skyrocketed 84.6% between 2019 and 2021.
Gypsum Building Materials: The PPI for gypsum building materials declined 0.3% in December and have not increased since March 2023. The index decreased 2% over the past 12 months, after increasing 44.6% over the two years ending December 2022.
Ready-Mix Concrete (RMC): RMC prices decreased 0.2% in November (seasonally adjusted), just the fourth decline over the last 36 months, because of a 0.9% price decline in the South; prices in the Northeast, Midwest, and West regions were unchanged. The average price of RMC increased 11.2% in 2023 and 10.3% in 2022 (NSA), combining for the second-largest two-year increase since 2000.
Steel Mill Products: Steel mill products prices climbed 3.3% in December, the first increase since May. Steel mill products annual average prices declined 16.1% in 2023 after increasing 8.7% in 2022 and the historic 90.3% increase of 2021. Prices are 31.2% lower than their 2021 peak but remain 65.1% higher than they were in January 2020.
David Logan, NAHB director of tax and trade policy analysis, provides more details in this Eye on Housing post.
Latest from NAHBNow
Advocacy
May 22, 2026
Local Leaders and Builders Unite to Tackle Workforce Gaps in HousingNAHB’s state and local team earlier this year helped convene mayors, city leaders, planners and builders in Orlando as part of the America’s Housing Comeback discussion series to examine workforce development challenges.
Advocacy
May 21, 2026
NAHB Urges Congress to Advance Housing Supply ReformsTestifying today before the House Small Business Committee on how small builders can help close the nation’s housing gap, NAHB Chairman Bill Owens said the core issue is a shortage of housing.
Latest Economic News
Economics
May 21, 2026
Single-Family Starts Fall Amid Economic Uncertainty and Affordability PressuresSingle-family housing starts declined in April as builders faced continued economic uncertainty and affordability challenges, including higher construction costs, ongoing labor shortages and elevated financing expenses. The latest housing starts and permits data suggest that the overall construction pipeline remains uneven across regions and property types.
Economics
May 21, 2026
Housing Affordability Edges Up in First Quarter but Challenges PersistWhile housing affordability remains out of reach for millions of Americans, particularly first-time and entry-level buyers, conditions have improved modestly in the last year, according to the latest data from the National Association of Home Builders (NAHB)/Wells Fargo Cost of Housing Index (CHI).
Economics
May 20, 2026
What It Takes to Leave Parental HomeAs of 2024, one in five adults aged 25-34 lives with parents or in-laws. NAHB’s analysis of the latest American Community Survey (ACS) Public Use Microdata Sample (PUMS) evaluates a wide range of socioeconomic and demographic factors that shape young adults’ path to independence.