We share two articles with you published on the Confédération Construction (Construction Confederation) website.
More and more construction firms saw the price of building materials increase by between 15 and 25% in January in relation to November 2021. These are the findings of the Confédération Construction’s survey in which 441 companies took part. The increase is most noticeable in the price of insulation materials. “At the end of last year, we thought the worst of the price increases was over, but this is clearly not the case”, explains Niko Demeester, CEO of the Confédération Construction.
Once again, the construction sector must cope with the increase in the price of building materials, as highlighted in the survey by the Confédération Construction in which 441 entrepreneurs took part. Compared to the last business survey in November 2021, the price of almost all building materials has risen. 6 construction firms in 10 (58% to be exact) have experienced price increases of more than 15% since November 2021 and one in four (24%) has noticed price increases of 25% or more. Persistent price increases are having a significant impact on the cash flow of construction firms: 8% faced major cash flow problems in January 2022 compared to 5% in November 2021.
And the immediate outlook is not good with inflation at its highest level in almost 40 years (7.59%) and with the highest monthly variation seen in 70 years in January.
Although the sector’s federation thought it had seen the worst of the crisis in November 2021 and believed that the price of building materials would start to drop once recovery was underway, this is clearly not the case. However, it would appear that this price increase is not being passed on to customers: in 54% of cases, it is the construction firm which covers the increase with the customer covering part of it but not all of it in 41% of cases. Delivery times are also severely affected. 56% of construction firms saw materials delivered more than two weeks late, and 32% more than four weeks late. The extension of delivery times mainly affects products involving installations, finishing work and artificial materials.
« Consequently, many construction firms are experiencing difficulties delivering their works. Also, three in four construction firms have not noticed an increase in procurement contracts despite the European, federal and regional recovery plans which should have been operational since last year »,
explains Niko Demeester, CEO of the Confédération Construction.
