This bulletin gives a brief overview of recent pricing trends in the property insurance, construction, and restoration industries.
As a reporter of market-specific pricing information for repairing or rebuilding structures and replacing personal property, Verisk conducts hundreds of thousands of industry surveys, and reviews millions of data points per year submitted through field estimates written by contractors and adjusters as well as electronic data feeds provided by retail merchants. This extensive library of research enables Verisk to provide a comprehensive report of important industry trends.
Hurricane Ian made landfall in Florida on September 28th, 2022 and again in South Carolina on September 30th, 2022 and was the deadliest hurricane to strike Florida since 1935. Our pricing team continually monitors areas where catastrophes and storms have occurred to help determine how local pricing may be affected due to increased demand and makes any warranted changes needed based on our research. A large spike of estimates occurred in areas impacted by the hurricane from September 28th to October 5th. In Florida, Ft. Myers saw the largest change in estimates at 9,448% followed by Sarasota at 4,929% signaling increased demand as a result of the hurricane.
The October price lists are inclusive of pricing updates for the areas impacted by Hurricane Ian. Customers can view the Industry Trend Reports for additional information.
Material costs are highly variable and are sometimes impacted by factors such as fuel costs, changes to industry practices, or natural disasters. Verisk closely monitors a wide variety of material costs across the country to ensure its price lists reflect any recent changes to pricing.
In the Third Quarter of 2022, Verisk observed changes in six key material categories. Roofing Material had the largest yearly change, showing an increase of 18.83 percent. Interior Trim Material also showed a large increase of 18.12 percent. Lumber Material had the largest quarterly decrease of 8.21 percent since July 2022.
The Material Composite Index report tracks a combination of several commonly used material components, including floor covering, paint, and roofing among others. The index showed a 0.81 percent cost increase in the Third Quarter of 2022 and an 11.48 percent cost increase since October 2021.
Verisk’s Pricing Data Services team also surveys thousands of contractors across the country each month to determine what they charge for labor. The labor cost of a Drywall Installer/Finisher had the largest quarterly percent change with a 2.90 percent increase as well as the largest annual change with an 11.58 percent increase. The cost of Siding Installers also had a large annual increase of 11.11 percent.
The Retail Labor Index report tracks a combination of several common trades, including floor covering, painting, and roofing. In the Third Quarter of 2022, the index showed a 2.17 percent cost increase, and since October 2021 the index showed a 9.80 percent cost increase.
The individual trades that contribute to the Retail Labor Index varied in their percent change over the quarter. The most significant quarterly change occurred in the labor cost of a Cleaning Technician which increased 5.10 percent since July 2022.
The Combined Labor and Materials report is based on monthly building cost data published by Verisk. It comprises a set of commonly used items and may be used as an indicator of trends within the marketplace. This combination of labor and materials makes up the majority of Verisk price list items. Tracking the percent change for the cost of these items provides a valuable gauge of the general market.
The Combined Labor and Materials report showed an increase of 1.31 percent in the Third Quarter of 2022 and a 9.87 percent increase since October 2021.
Fuel costs are extremely volatile and are a factor in item pricing. High oil prices can push up the price of some raw materials. Fuel costs decreased 20.73 percent over the Third Quarter of 2022 and have increased by 18.56 percent since October 2021. Verisk’s Pricing Data Services carefully tracks fuel costs to ensure accurate pricing.
Since October 2021, lumber prices have decreased by 6.28 percent. During the Third Quarter of 2022 lumber prices have continued to decrease, showing a downward trend of 8.21 percent. Sheathing materials have also decreased 10.47 percent from July 2022 to October 2022.
The Basket of Goods reports are also a good indicator of the impact that lumber costs have had on market pricing. Since October 2021, the Basket of Goods Labor & Material report has shown an increase of 9.90 percent. When framing components are removed from this basket of goods, the report shows an increase of 10.30 percent.
Since October 2021, the Basket of Goods Material report has shown an increase of 11.50 percent. When framing components are removed from this basket of goods, the report shows an increase of 12.10 percent.
Verisk is continually monitoring lumber materials and making warranted adjustments from focused surveys with suppliers for each monthly price list publication.
Annual Property Report
Verisk publishes annual property reports that focus on key trends during the previous calendar year. To order a copy of Verisk’s Property Report for the United States or Canada, please visit the Verisk Online Store.
Industry Trend Reports
Using Industry Trend Reports, Verisk customers can examine pricing trends on national, state or province, and local levels for key material and labor pricing changes in multiple trades. Trends can be viewed by the month or over extended periods of time. For more information about Verisk’s Industry Trend Reports, or to receive access to them, please contact your sales representative or call 1-800-424-9228.
Pricing Methodology White Paper
For more information about Verisk’s methodology for researching and publishing pricing information, please see the Pricing Research Methodology white paper on the eService Center.
Unless otherwise stated, the values reported in this bulletin are national averages for the United States and will vary from local prices.