The Royal Institution of Chartered Surveyors (RICS) has observed a rise of over 3% per annum in private housebuilder's costs in the UK owing to an increase in cost of resources and continued demand for new houses over the year.
“The BCIS Private Housing Construction Price Index (PHCPI) rose 3.7% in the year to 3rd quarter 2016 compared with a 1.6% rise in general construction costs, as measured by the BCIS General Building Cost Index (GBCI), and a 5.8% rise in tender prices, as measured by the BCIS All-in Tender Price Index,” the RISC said in its latest note.
The resources cost was stable in 2014 and 2015, but rose steadily in the last one year. Similarly, the tender prices also increased significantly through 2016. Consequently, it impacted the cost of private house building and the hike would be witnessed in the market this year. This would further aggravate the housing crisis in the UK, as the cost of acquiring a home would go up significantly.
The BCIS (Building Cost Information Services) of the RISC is a leading provider of cost and price information related to the construction industry in the UK.
Demand pressures and an upturn in the cost of resources are reportedly to blame for a rise of over 3% per annum in private housebuilder's costs.