The Corona pandemic is likely to affect every industry segment and every area of our life, the ramifications being impossible to accurately predict today. However, here are some of the probable effects on construction prices:
- Slower investments – most investors will probably adopt the “wait and see” strategy, keeping their money in their accounts, rather than spending it. The longer such investments are delayed, the more builders will be forced to lower their prices to convince investors to invest;
- Labor shortage – the crisis is likely to have a negative effect on the availability of labor force as well. The building industry was suffering from labor shortage before the crisis, which resulted in higher wages in the segment and the shortage is probably going to aggravate. The process might lead to the paradoxical situation of construction companies being forced to pay higher wages and to lower building prices simultaneously;
- Issues related to material supplies – the building companies that have been strongly relying on materials coming from China will probably have to turn to local manufacturers to source their materials. The process will probably help local economies and material prices are likely to drop as the costs of long-distance transport can be eliminated and replaced with the much lower costs of domestic, local transport.
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