Obscene increases in building/construction materials prices
Discussion
I have watched, with absolute disbelief, the rise of materials prices over the last few months, and I am now wondering where it will all end.
Roof trusses and floor joists that were priced at £13k last June are now being priced at £30k.
General building timber has gone up 80% in 6 months.
Insulation and insulated plasterboard has gone up 60% in 6 months.
Oak products have gone up 70%.
Copper products have doubled.
Steel has more than doubled.
The country is quite literally running out of many of the materials required to build a house.
Was talking to a friend who works for a fairly well known housebuilder, and they were saying that if the current tend does not right itself very quickly, then we could potentially see £100k or more added to the cost of building a new house, just to cover the increased materials costs.
Difficult times for everyone in the industry, and also those who are planning a renovation or extension of their own home.
I have no doubt this will also have a knock on effect with regards to the property market as a whole.
Roof trusses and floor joists that were priced at £13k last June are now being priced at £30k.
General building timber has gone up 80% in 6 months.
Insulation and insulated plasterboard has gone up 60% in 6 months.
Oak products have gone up 70%.
Copper products have doubled.
Steel has more than doubled.
The country is quite literally running out of many of the materials required to build a house.
Was talking to a friend who works for a fairly well known housebuilder, and they were saying that if the current tend does not right itself very quickly, then we could potentially see £100k or more added to the cost of building a new house, just to cover the increased materials costs.
Difficult times for everyone in the industry, and also those who are planning a renovation or extension of their own home.
I have no doubt this will also have a knock on effect with regards to the property market as a whole.
Edited by anonymous-user on Tuesday 11th May 09:20
Lord Marylebone said:
Was talking to a friend who works for a fairly well known housebuilder, and they were saying that if the current tend does not right itself very quickly, then we will see £100k or more having to be added to the price of every new house just to cover the increased materials costs.
They wish. New build houses can be made with mass-produced UK-supplied papier mache just as badly as with Polish stuff. OpulentBob said:
Lord Marylebone said:
Was talking to a friend who works for a fairly well known housebuilder, and they were saying that if the current tend does not right itself very quickly, then we will see £100k or more having to be added to the price of every new house just to cover the increased materials costs.
They wish. New build houses can be made with mass-produced UK-supplied papier mache just as badly as with Polish stuff. So unfortunately no. Somehow trying to build using UK manufactured products won't help.
monthefish said:
Doesn't work like that I'm afraid. There are far wider forces at work that control house prices.
Yes, there are absolutely much bigger market forces at work which affect house prices.But:
You can't build houses at a loss.
We need houses to be built.
All we can hope for is that supply chains straighten themselves out as soon as possible, otherwise house builders are simply going to stop building, or start increasing prices of new build homes, neither of which will do anything to help our current housing crises.
monthou said:
Lord Marylebone said:
You can't build houses at a loss.
We need houses to be built.
If the cost of building a new home increases and house prices don't move then the cost of building land will go down. In the short term some builders may make a loss.We need houses to be built.
If the cost of building a 3 or 4 bed detached house has just risen by, say £50k, it is not possible for this increase to be absorbed by the land, as they will have paid less than that for the plot.
Also, the landowners may not be willing to lower the land price, preferring to wait it out.
Sheepshanks said:
Zippee said:
Tell me about it. Currently getting plans drawn up for a 2 storey extension. Wandering if it's worth waiting a few months for this to die down....
Have you got a builder lined up? We've just got planning permission and initial enquiries with local builders suggest thinking about March/April 2022 to start.On the lumbar front, I've heard it's all there ready to be shipped but they just can't get it here, and when they can, shipping costs are enormous.
On commodities generally, it's reckoned we could be in for a "supercycle" - a 10yr period of surging prices.
"During this phase, caution is thrown to the wind, as asset prices skyrocket. Valuations reach extreme levels during this phase as new valuation measures and metrics are touted to justify the relentless rise, and the "greater fool" theory—the idea that no matter how prices go, there will always be a market of buyers willing to pay more—plays out everywhere"
Mammasaid said:
monthou said:
Lord Marylebone said:
You can't build houses at a loss.
We need houses to be built. We need 'poor' housebuilders to be able to keep making obscene profits...Ask yourself why we need to keep concreting over the countryside.
If the cost of building a new home increases and house prices don't move then the cost of building land will go down. In the short term some builders may make a loss.Someone has to build them, and they have to be built somewhere.
Not sure what other solutions there are to all of this. If we didn't have large housebuilding companies delivering 200,000+ homes per year, we would be screwed.
Mammasaid said:
Lord Marylebone said:
We need to build 300,000-350,000 homes per year to get anywhere near equilibrium in the housing market.
Someone has to build them, and they have to be built somewhere.
Not sure what other solutions there are to all of this. If we didn't have large housebuilding companies delivering 200,000+ homes per year, we would be screwed.
Ask why we need 300k plus new houses a year?Someone has to build them, and they have to be built somewhere.
Not sure what other solutions there are to all of this. If we didn't have large housebuilding companies delivering 200,000+ homes per year, we would be screwed.
If you build it, they will come....
https://www.bbc.co.uk/news/business-42055623
Article said:
Richard Disney, professor of economics at University of Sussex, said: "The simple answer is this is a number plucked out of thin air, since affordability depends on price and income."
What we do need is more social housing and redevelopment of city/town centres to reflect changes in society. The other quotes confirm that we do need 300k new homes per year, simply to meet demographic demand. Our population is growing and we need houses.
The article goes on to say that if we want to have any meaningful impact on house prices, or at least slow the rise of prices, we need to be building even more than 300k homes per year.
I agree about social housing. Delivering new social housing developments is the sector I work in. We are always looking to build as many new homes as possible, but we face the same challenges as everyone else who is building homes.
I also agree about the redevelopment of town/city centres. We need to turn centres in much greater areas of residential homes, leisure, and entertainment, as well as places of work.
I think we can sum this up by saying we need s
tloads of new homes, both affordable and open market.blueg33 said:
speedyguy said:
blueg33 said:
On the housing crisis here are some stats borrowed from a white paper last year
Do you have the link to that handy? Ta 
I left the bullcarp of highways recently and back into construction supplies this month after a long break, quite interesting listening to the big shortfalls of the most basic aggregates and cement etc. I've known for a while about the wood issues 'fnaar fnaar'
Edited by anonymous-user on Monday 10th May 22:49
Pit Pony said:
The house building I see seems to be like an assembly line.
Each week they start a new house. Gradually the scaffolding moves along to the next plot.
As a manufacturing engineer, I assumed they were working a standard Takt time. Each week the same things happen over and over again, one house at a time. ? If not? Why not ?
I think it is safe to say that large housebuilders know the fastest and most efficient ways to build houses. There are quite literally teams of people looking for time and efficiency savings across all aspects of the design, procurement, supply chain and building process.Each week they start a new house. Gradually the scaffolding moves along to the next plot.
As a manufacturing engineer, I assumed they were working a standard Takt time. Each week the same things happen over and over again, one house at a time. ? If not? Why not ?
Things always develop and improve, but right now, there isn't any major or obvious ways to speed up the construction process of housing developments, but of course this is all dependent of the sales of the houses.
blueg33 is involved with MMC construction methods, which in my opinion truly is going to be the next big thing for delivering the houses we need. We have been seeing it more and more in the social housing sector as well as elsewhere, and it has proven itself time and time again on various developments.
MMC really is something that will genuinely deliver houses faster than what we have at the moment.
blueg33 said:
Corruption in planning is vanishingly rare, in 30 years and many hundreds of applications I have never seen any evidence of corruption, its never been hinted at. Sadly incompetence on the other hand is disappointingly common.
Council owned developer (many of these around at the moment) actually has to be even more cautious in planning as any errors would leave them wide open tpo high court challenge, plus the scrutiny of the committee is even more onerous.
This.Council owned developer (many of these around at the moment) actually has to be even more cautious in planning as any errors would leave them wide open tpo high court challenge, plus the scrutiny of the committee is even more onerous.
My brother was a senior planning officer for a local authority for 15 years, and is now a planning consultant. He used to get jokes constantly from people about 'brown envelopes stuffed with cash' etc.
None of it was true at all. He said they were all absolutely by the book and he never saw any hints of corruption or favouritism. There is no way anyone would risk their cushy local authority job, a decent salary, pension, and their career, by accepting a couple of grand in an envelope, showing favouritism, or whatever. It makes no sense.
If you see a new build development or similar announced on a Facebook news article, there will be hundreds of comments below it from the general public along like lines of 'Money talks' and 'Brown envelopes all round', and it just shows how little the public actually know about development.
If anything, local authority planning departments are overly cautious, and some have a tendency to veer towards refusals for flimsy reasons, which then get promptly overturned at appeal.
My brother has been battling with the same planning officer at a particular local authority for several years over numerous applications he has dealt with. She just refuses practically everything because she hates receiving phone calls from angry residents about why she has approved a new house next to them, or a new development. She is scared to approve. The last time she refused something, her manager was there, and my brother just said, "Right, I'll start the appeal process this afternoon then" knowing full well the appeal would side with him. The manager practically started begging "No, please don't do this to us again, we'll get our backsides kicked". No sympathy.
Sheepshanks said:
Lord Marylebone said:
If anything, local authority planning departments are overly cautious, and some have a tendency to veer towards refusals for flimsy reasons, which then get promptly overturned at appeal.
So they're in league with planning consultants and lawyers to generate more work? I thought councils got into trouble if they ran up fees defending an appeal when they had no grounds to refuse the original application?
The irony of course is that 'the general public' are actually desperate for new housing. Just as long as it is nowhere near them. But housing usually has to go near someone.
Yes, councils do get into trouble if they get taken to appeal for no reason, or too often. Hence my comment in an earlier post about the senior planning officer at a council begging my brother not to take them to appeal yet again, as they knew they would get their backsides kicked and it would cost them.
Drumroll said:
CoolHands said:
How can aggregates and stone etc be up? Have quarries suddenly got a supply problem? Oh no, that big hole in the ground is still there. Rip-off century I’m telling you.
Whilst the "hole in the ground" may still be there most Quarries have limits put on how much material they can take out over a set period. Companies that take aggregates from the sea can only "mine" in certain areas and can only take certain amount of material.
and HS2 is taking an awful lot of stone capacity and straight onto trains from the Derbyshire area down south. C Lee Farquar said:
I spoke too soon, had a call today. Bulk cement up 6% from July, non negotiable.
At least it will be easy to pass on.
Letter yesterday, Bulk sand going up 1st June and reps were in last week to inform of stone price rises, rum feckers, blaming cement rise on 'carbon credits' as well. At least it will be easy to pass on.
Mr Whippy said:
What do people expect?
Pay people who would make stuff to sit around at home consuming stuff instead.
Supply vs demand issues.
If this isn’t a sign of why UBI is a bad idea I don’t know what is.
It has been the perfect storm.Pay people who would make stuff to sit around at home consuming stuff instead.
Supply vs demand issues.
If this isn’t a sign of why UBI is a bad idea I don’t know what is.
1) Loads of people paid to sit at home on furlough - These people get bored then endlessly look for stuff to buy, spend the money like water, renovate their gardens, build patios, renovate homes, buy themselves things. Lockdown means they can’t spend it on the usual stuff like eating out.
2) People are working from home - Have plenty of spare cash due to lockdown and no commute - They end up spending money like water, build themselves garden rooms for offices, improve their gardens, loft conversions, redecoration, build extensions, renovate their homes, decide they need a new kitchen etc
3) Covid has disrupted manufacturing and supply chains.
4) Brexit has disrupted supply chains.
So yeah, demand has been biblical and supply has been severely dented.
All we can hope for is that everyone’s ‘home renovation’ or ‘home office’ projects will be coming to an end, people will be sent back to offices, spare cash will reduce, supply chains and manufacturing will recover, and the equilibrium will be restored.
Going on recent experience it's not just materials that are in short supply. Trades people have become a rarity too. Anyone else experience waiting for them to arrive, then they are working for a couple of hours - turn your back and they've gone to do the same at another job. Juggling lots of jobs at once, but being very inefficient in the process.
BBC have picked up on it now
BBC News - Building projects hit by lack of supplies and price rises
https://www.bbc.co.uk/news/business-57247757
I've been on sites this last couple of weeks and the lazy incompetents have just got bags of cement lay everywhere in all weather yet others can't get it for love nor money just to 'line' a concrete pump.
BBC News - Building projects hit by lack of supplies and price rises
https://www.bbc.co.uk/news/business-57247757
I've been on sites this last couple of weeks and the lazy incompetents have just got bags of cement lay everywhere in all weather yet others can't get it for love nor money just to 'line' a concrete pump.
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