The pace of construction prices remain high
27 mar 2019
Low interest rates combined with an investment upturn and labour shortage result in a significant upward pressure on building material prices and labour costs. Given the monetary authorities’ lenient stance and the continued growth in the construction industry, price pressures in the construction market are expected to persist throughout 2019.
According to the official GUS indicator, the pace of construction prices remained flat at 3.6% y-o-y in February. Asking prices of construction services continued to grow the fastest for public buildings, in particular sports and education facilities. Fast-paced growth was also registered for other building structures, e.g. office, residential and retail buildings.
With regard to the types of work, the strongest growth was registered for prices of flooring services, asphalt concrete base course, plastering work, installation services and services involving reinforced concrete.
The prices of practically all groups of building materials continued to grow in February as well. On a year-on-year basis, the strongest growth (of over 19%) was again recorded for wall-building materials. Double-digit price increases were also registered for cement and lime category, according to PSB data.
The official growth of GUS construction and assembly prices has fluctuated within a very narrow range between -2% and 4% over the last five years. However, the ratio fails to reflect real price changes. Contractors generally believe that there is no reliable source in Poland to reflect real changes in prices, especially with regard to prices established between contractors and subcontractors. And actual contract prices can greatly vary from general price lists published by companies. Depending on the phase of business cycle, price differences can be either positive or negative.
For further information and monthly and quarterly data for the construction market, refer to our monthly reports "Construction market in Poland".
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