Building tender prices up 1%

Building firms are continuing to quote higher prices for large-scale construction jobs, with new data showing a 1% increase in tender prices in the first six months of 2012.

Updated figures from the Society of Chartered Surveyors Ireland show that the trend of moderate price rises for building projects seen over the past 12 months is steadily continuing.

The latest Tender Price Index from the society also notes a 3% year-on-year rise for the first half of 2012. The 1% increase was measured against the second half of 2011.

However, tender prices are still well below their peak levels and are only at a level last seen 13 years ago, in 1998. The latest index shows a reading of 104.5 points — it stood at 152 points five years ago.

The index covers private and commercial build projects with values of over €500,000.

According to Andrew Nugent, the chairman of the society’s quantity surveying professional group, the historic low index reading of 101.5 seen in the first half of last year could not be sustained and the gradual rise in construction tender prices are on the back of continued increases in building costs and rising input costs, such as materials and energy costs.

“As an island nation, we rely on world market commodities, which can have a significant impact on our cost competitiveness,” he said.

“Furthermore, the increases in building costs, over the past 12 months, continue to reflect the reality on the ground — that there is a shortage of new construction projects and, consequently, a diminished pool of available contractors.”