Developments between April and May 2020

The Construction Cost Index for multi-dwelling remained unchanged between April and May 2020. In the corresponding period in 2019, the Index increased by 0.6 percent. Contractors’ costs, which account for more than 82 percent of the Construction Cost Index, remained unchanged between April and May 2020.

In May, as in April, the temporary reduction in employers’ costs that applies from 1 March to 30 June 2020 has been taken into account. In March, there was no basis for calculating the effect on the Construction Cost index. This decrease was an important reason for lower construction costs in April and May.

Contractors’ costs in the group ‘transport, fuel and electricity’ decreased by 0.6 percent. This was mostly due to a decrease of 2.9 percent in the cost of diesel oil compared with April. Contractors’ other costs fell by 0.1 percent, while the costs of wages and salaries and machinery costs remained unchanged.

Contractors’ costs in the group ‘building materials’ increased by 0.2 percent. In the group ‘building materials’, the cost of electric material rose most, by 0.8 percent. The cost of plumbing material rose by 0.6 percent. All costs in other building material groups increased or remained unchanged with the exception of the cost of other building materials and white goods, which decreased. The cost of other building materials fell most, by 1.2 percent.

Over the past month, investor costs, which consist of interest and credit costs, costs for plans, and central administration decreased by 0.1 percent.

Developments between May 2019 and May 2020

The Construction Cost Index for multi-dwelling buildings decreased by 2.4 percent between May 2019 and May 2020. Contractors’ costs amounted to -2.8 percent in May. This decrease in contractors’ costs led to a decrease of 2.3 percentage points for the total index in the same period. Investor costs decreased by 0.4 percent on an annual basis.

Contractors’ costs and investor costs have been affected by the temporary reduction in employers’ costs. Wages and salaries account for about 40 percent of the Construction Cost Index.

Wages and salaries and costs in the group ‘transport, fuel and electricity’ decreased by 8.5 percent and 6.6 percent respectively. Contractors’ other costs fell by 3.1 percent.

This decrease in contractors’ costs was partly offset by higher costs for building materials and machinery, which increased by 1.2 percent and 0.5 percent respectively between May 2019 and May 2020. White goods and electric material accounted for the largest price increase in the building materials group, 5.3 percent and 5.2 percent, respectively. Costs in other building material groups also rose, with the exception of the cost wood products, woodwork, other building materials and reinforcement steel, which decreased.