Quarterly reconstruction cost growth rate flattens

February 11, 2025 / 2 min read

The latest 360Value^® Quarterly Reconstruction Cost Analysis report gives an overview of current reconstruction cost trends at the national and state levels for the United States from January 2023 to January 2024.

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Total reconstruction costs, including materials and retail labor, increased by 5.0% from January 2024 to January 2025, virtually unchanged from cost growth from January 2023 to January 2024 (4.9%). Cost growth in Q4 2024 also decreased to 1.0% from 1.4% the previous quarter.

State changes for reconstruction costs

Total residential costs increased by 4.5% from January 2024 to January 2025 and 0.9% from October 2024 to January 2025. Residential reconstruction costs increased year over year in all states.

Kansas had the largest increase at 6.91%, followed by Washington (6.35%) and Nebraska (6.31%). Georgia’s rank rose most significantly, from 38th in October 2024 to 17th in January 2025; costs were up 5.15% in the state year-over-year.

Q1 residential reconstruction costs

Total commercial reconstruction costs increased 5.5% from January 2024 to January 2025 and 1.0% from October 2024 to January 2025. Commercial reconstruction costs increased by at least 3.37% in all states.

Rhode Island had the largest increase at 10.14%, followed by Kansas at 8.37% and Washington at 8.35%. Maine had the largest rank jump—from 21st to fourth—with an increase of 8.23%.

Q1 commercial reconstruction costs

Material and labor cost changes

Material costs rose by 2.6% from January 2024 to January 2025. The increasing month-to-month trend was consistent through most of 2024, except for a slight drop from November to December. Lumber remained relatively flat, increasing 0.3% over the past 12 months—but 0.4% in the most recent quarter. Concrete material again had the largest quarterly increase in the United States, up 1.70%, similar to the previous quarter’s growth of 1.77%.

Combined hourly retail labor costs increased by 5.3% from January 2024 to January 2025, up from their 4.7% increase from October 2023 to October 2024. Concrete masons again had the largest quarterly change, but cost increases were slower at 2.76%, following an increase of 8.49% the previous quarter and 26.3% in the past 12 months.

Market expectations

The Verisk Market Expectations Index for reconstruction costs anticipates a 1.98% increase for residential and 2.22% for commercial from January 2025 to July 2025.

Verisk’s Market Expectations Index delivers forward-facing insights every quarter via CSV download. Get 3-, 6-, and 12-month future indexes for residential and commercial structures based on regional reconstruction costs down to individual ZIP codes. To learn more about the Market Expectations Index, contact Trish Hopkinson, head of 360Value, at trish.hopkinson@verisk.com.

Read the latest 360Value Quarterly Reconstruction Cost Analysis for more information on this quarter’s performance.

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