Construction Costs
A guide to navigating rising construction costs in 2024
As a construction business leader, construction costs are likely to be on your mind. Discover key challenges that await you in 2024 and beyond and understand what you can do to stay ahead.
Will construction costs go down in 2024?
The question the entire industry is asking is will construction costs go down in 2024? The short answer to this question is no. Construction costs are predicted to increase by 8.5 per cent by the end of the year. But with all of the talk of uncertainty, what can you actually do about it?
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Key threats to construction profit margins
What you can't control...
Material hikes
Construction material costs are expected to increase by 8.5%.
Access to credit due to high-interest rates
With the economy predicted to decrease by -1.3% and recession expected to soon follow, investments are set to slow.
Poor industry growth
Sector insight specialist Glenigan predicted a 2% fall in most projects.
Labour costs
Labor costs are set to increase by 3.7%.
Inflation
Inflation rates continue to rise to over double digits.
Skilled labour
Difficulty finding skilled labour has led to a 23% increase in the time typically taken for a project to progress from detailed planning consent to start on-site.
What you CAN control...
Wasted time on non-value-adding tasks
Project managers spend on average 16 hours per week conducting site walks and 17 hours on paperwork and emails.
Reworks
$250K out of every $5M spent on a construction project goes towards reworks.
Miscommunications between trades
Almost half of all reworks are caused by miscommunication.
Inefficient progress and task management
Main Contractors spend an average of 1,500 hours per month trying to understand the progress of a project.*
Delays caused by poor handovers
Handovers typically take more than one day per handover, per work area spent.*
Poorly planned sequence of work
Incorrect sequences cause at least one quality issue per apartment.*
On a typical residential project involving 500 units*
Construction Industry Forecast 2023-2024, Glenigan
Growth rate of construction labor costs in the United Kingdom (UK) from 2018 to 2021, with forecasts until 2023, Statista.com
Connected Construction: A Path to Collaborating Better, Together
How Sablono helps you get back your profits
Sablono helps to transform your processes and improve overall clarity on projects to boost the bottom line.
It’s saved our partners over 600 hours and £10,000+ per month, per project.
Multiply this across your enterprise and it has the potential to help you save millions.
Wasted time on non-value-adding tasks
Sablono transforms your project into an optimised production plan, eliminating paperwork and empowering project leaders with the necessary time, tools, and insights to make quicker, more informed decisions.
Reworks
Fully digitalise your quality processes. Embed quality control into your execution phase for proactive defect management that helps you to prevent issues from happening in the first place.
Miscommunications between trades
Connect everyone on a project with a centralised system that gives one version of the truth and instant, easy access to project information.
Inefficient progress and task management
Unlock clear, real-time project data that provides true clarity. Connect all aspects of time quality and cost and track hundreds of thousands of activities down to the finest detail.
Delays caused by poor handovers
Streamline trade handovers by having trades easily report the status of their activities in the Sablono app and automatically notifying the next trade when work is ready for them to complete.
Poorly planned sequence of work
Generate work sequences based on data insights that identify the optimal approach for completing tasks. Standardise these processes across your projects to minimize quality issues and maximize productivity.
Help for your next project ...
Want to discover how Sablono can help you capture back time and money on your next project? Schedule a personalised demo below.