Houstons Construction Market Faces Massive Material Shortages
Published By : 09 Oct 2014 | Published By : QYRESEARCH
Houston construction industry is facing touch challenges such as increasing cost of building materials and stressed out labor market due to fierce competition and poaching. According to industry experts, these challenges are expected to continue in the near future too.
Though the market has 5.4 million square feet of building contracts to deliver by the end of 2015, the competition for men and materials continues to be a tight one. This delivery is definitely higher as compared to a total of 3.2 million square feet in 2013. President and CEO of Houston-based Arch-Con Corp, Michael Scheurich the cost of materials is rising as it helps developers an opportunity to raise prices and gain more profit.
According to the reports published by Associated General Contractors of America, the price of concrete at a national level has increased by 4% over the year. The other materials used in construction such as lumber in plywood has become 11% dearer, while gypsum which is used in interior walls and ceiling coverings is up by another 8%. Additionally, the cost of steel has also increased by 4%. The price of each material cannot be identified with accuracy as it depends on the supply and demand forces too.
Chairman and CEO of Houston-based D.E. Harvey Builders, David Harvey Jr stated, the demand for all types of construction such as apartments, offices, retail, residential, hospitality, and highways has been an upward trend in the recent past.
While these costs have significantly increased in the past few years, the construction industry, especially in Houston has been labor shortages, concrete crunches, longer lead times, increasing contractor fees and unavailability.