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 research library enables Verisk to provide a comprehensive report of important industry trends.
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 Fourth Quarter of 2022, Verisk observed changes in six key material categories. Interior Trim Material had the largest quarterly increase, showing an increase of 6.70 percent. Roofing Material had the largest annual increase of 24.87 percent since January 2022. Lumber is still dropping, showing a decrease of 4.69 percent since January 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 1.85 per cent decrease in the Fourth Quarter of 2022 and a 1.82 per cent increase since January 2022.
Verisk’s Pricing Data Services team also surveys thousands of contractors across the country each month to determine what they charge for labour. The individual trades that contribute to the Retail Labour Index varied in their percent change over the quarter. The most significant quarterly change occurred in the labour cost of a Flooring Installer which increased 4.79 percent since October 2022. The Siding Installer had the largest annual change with a 15.41 percent increase.
The Retail Labour Index tracks a combination of several common trades, including floor covering, painting, and roofing. In the Fourth Quarter of 2022, the index showed a 2.11 per cent cost increase, and since January 2022 the index showed a 9.35 per cent cost increase.
The Combined Labour 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 labour and materials makes up the majority of Verisk price list items. Tracking the per cent change for the cost of these items provides a valuable gauge of the general market.
The Combined Labour and Materials report showed an increase of 0.17 per cent in the Fourth Quarter of 2022 and a 6.89 per cent increase since January 2022.
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 prices have decreased 12.06 percent over the Fourth Quarter of 2022 and have increased 3.03 percent since January 2022. Verisk’s Pricing Data Services carefully tracks fuel costs to ensure accurate pricing.
Year over year fuel costs in Canada are now close to zero, a level not seen since January 26th 2021. From 2021 to 2023 gasoline peaked at an increase of 65 per cent in Canada.
During the Fourth Quarter of 2022 lumber prices have continued to decrease, showing a downward trend of 12.30 percent. Sheathing materials have also decreased 20.34 percent from October 2022 to January 2023. However, since January 2021, lumber prices have increased by 13.16 percent.
The Basket of Goods reports are also a good indicator of the impact that lumber costs have had on market pricing. Since January 2022, the Basket of Goods Labour & Material report has shown an increase of 6.89 percent. When framing components are removed from this basket of goods, the report shows an increase of 8.34 percent.
Since January 2022, the Basket of Goods Material report has shown an increase of 1.82 percent. When framing components are removed from this basket of goods, the report shows an increase of 4.54 percent.
Verisk is continually monitoring lumber materials and making warranted adjustments from focused surveys with suppliers for each monthly price list publication.
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 Canada or the United States, please visit the Verisk Online Store.
Using Industry Trend Reports, Verisk customers can examine pricing trends on national, state or province, and local levels for key material and labour 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.
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 Canada and will vary from local prices.