Changes in the last month

The Construction Cost Index for multi-dwelling buildings increased by 1.3 percent in July compared with June. In the corresponding period in 2020, the Construction Cost Index increased by 2.9 percent. Last year, the temporary reduction in employers’ costs that applied from 1 March to 30 June 2020 and the central government compensation to employers for sick pay costs was taken into account.

Contractors’ costs increased by 1.5 percent between June and July 2021 and construction clients’ costs increased by 0.4 percent. These two groups accounted for 82 percent and 18 percent of the Construction Cost Index, respectively.

Contractors’ costs for building materials increased by 3.1 percent between June and July 2021. In the group ‘building materials’, the cost of wood products and reinforcement steel rose most, by 16.8 percent and 14.0 percent respectively. The costs of iron and steel, including reinforcement steel, rose by 8.6 percent. All costs in building material groups rose slightly or remained unchanged.

Contractors’ costs in the group ‘transport, fuel and electricity’ increased by 1.4 percent. Machinery costs, overhead costs and costs of wages and salaries remained unchanged.

Construction clients’ costs consist of interest and credit costs, costs for plans, and central administration. All of the construction clients’ costs rose slightly or remained unchanged.

Changes in the last year

The Construction Cost Index for multi-dwelling buildings increased by 6.7 percent between July 2020 and July 2021. Contractors’ costs rose by 7.6 percent, which led to an upward contribution of 6.2 percentage points to the total increase in the Construction Cost Index. Construction clients’ costs increased by 2.8 percent, which led to an upward contribution of 0.5 percentage points to the total index in the same period.

Contractors’ costs and investor costs were both significantly affected by the central government compensation to employers for sick pay costs last year. Wages and salaries account for about 40 percent of the Construction Cost Index.

Contractors’ costs of building materials increased by 11.9 percent between July 2020 and July 2021. Reinforcement steel and wood products accounted for the largest price increase in the building materials group, 62.5 percent and 55.4 percent respectively. The costs of iron and steel, including reinforcement steel, rose by 34.7 percent. The sharp increase in costs for wood products and steel is due to a shortage of raw materials as a result of increased global demand. All costs in building material groups rose, but to a smaller extent.

Between July 2020 and July 2021, contractors’ costs for wages and salaries increased by 5.9 percent. In July 2020, wages and salaries were affected by the central government compensation to employers for sick pay costs. In June 2021, wages and salaries rose by 15.8 percent, as the temporary reduction in employers’ tax last year affected this increase. Contractors’costs in the group ‘transport, fuel and electricity’ increased by 8.7 percent. Overhead costs rose by 2.5 percent, while machinery costs fell by 2.0 percent.

Construction Cost Index for multi-dwelling buildings, excl. wage drift and value-added tax.

Construction Cost Index for multi-dwelling buildings, excl. VAT