Quarterly reconstruction costs continue to stabilize

May 7, 2024 / 2 min read

Verisk recently released its latest 360Value^® Quarterly Reconstruction Cost Analysis report, which offers an overview of current reconstruction cost trends at the national and state levels for the United States from April 2023 to April 2024.

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Total reconstruction costs, including materials and retail labor, increased by 4.6% from April 2023 to April 2024. This is slightly more than the 4.1% rise from January 2023 to January 2024, suggesting that reconstruction costs may be starting to normalize following the pandemic.

State changes for reconstruction costs

Residential and commercial reconstruction costs continued to increase in all states.

Colorado and New Hampshire had the two highest residential reconstruction cost increases at 9.19% and 8.66%, respectively. Nevada (2.69%) and Alaska (2.85%) had the two lowest. California’s rank changed most significantly, falling from the 14^th-highest cost increase in January 2024, to the 44^th-highest in April 2024.

residential reconstruction costs q2 2024

For the second quarter in a row, Colorado and New Hampshire had the two highest year-over-year commercial reconstruction cost increases at 12.03% and 11.77%, respectively. Alaska (3.16%) and Maine (3.19%) had the lowest. Florida and Idaho saw the most significant changes in ranking: Florida rising from 47^th to 15^th and Idaho rising from 43^rd to 21^st.

Material and labor cost changes

Combined costs for material composites increased 3.2% from April 2023 to April 2024, largely driven by the cost of stucco, OSB sheathing, fascia, soffit, and carpet pads. The cost of concrete composite continues to grow while lumber prices continue to drop.

Combined hourly retail labor costs increased by 4.8% between April 2023 and April 2024. Labor costs have risen for the last few years, but their growth rate seems to be slowing, as evidenced by the minor increase of 0.9% in Q4 2023 and the even smaller increase in Q1 2024.

Market Expectations

Due to ongoing volatility with respect to global warming, extreme weather events, supply chain issues, and labor strains – among other challenges – Verisk data indicates that residential and commercial reconstruction costs will continue increasing by about 2.5% between April and October 2024.

Verisk’s new 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. Download now