Chartered surveyors expect the price of construction materials to continue rising in 2025 despite a return to a “steadier pattern” of inflation in recent months, an industry survey has revealed.
The Government should take advantage of the current price environment, Society of Chartered Surveyors Ireland president Kevin Hollingsworth said as its biannual construction tender price index showed prices rose 1.5 per cent in the second half of the year, the same as the figure for the previous six months.
It means tender prices for commercial construction increased by a cumulative 3 per cent last year, down from 3.9 per cent in 2023 and from an annual median rate of 11.5 per cent in 2022, illustrating the volatile environment in which the sector has been operating in recent times, the SCSI said.
“In terms of the formation of a new Government and the programme for government, the return to more sustainable levels of inflation presents an opportunity to accelerate the much-needed investment in public infrastructure in areas such as utilities, transportation and healthcare,” Mr Hollingsworth said.
He said the return of inflation to a “steadier pattern” in recent months is a “welcome improvement” for a sector beset by cost and manpower challenges.
[ Housing affordability crisis no longer confined to Dublin - SCSI reportOpens in new window ]
The slowdown in inflationary pressure was due largely to the competitiveness of the commercial construction sector and reduced price volatility for construction materials, the SCSI president said.
The report indicates that the industry is also concerned about the introduction of tariffs on goods and services to the US.
Based on a survey of SCSI members, the report indicates that more than half of surveyors believe construction material prices have peaked or are close to the end of the upswing.
However, a large minority – some 34 per cent – believe materials prices are at the bottom of the cycle or in an early upswing and some are concerned the introduction of tariffs on goods imported into the United States could be a factor in the future.
“Surveyors indicated that they anticipate tender prices, labour and materials will continue to increase in the first half of 2025,” Mr Hollingsworth said. “But due to the global volatility and the open nature of the economy, they said it was very difficult to predict if the more moderate rates we have seen over the last year and a half would continue.”
He said: “Many members also raised concerns over the introduction of tariffs on goods and services to the US, in terms of the potential impact it may have on the wider economy and in turn on capital investment.”
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