When is the best time to construct a new building?
1. Planning Around Manufacturer Price Increases
Manufacturers in the construction industry often implement price increases, which tend to be more predictable during certain times of the year. For example, many manufacturers issue annual price hikes, typically at the start of a new fiscal year. However, price increases can also occur sporadically in response to changes in raw material costs, labor shortages, or global market shifts.
Being aware of these fluctuations and planning your project timeline to avoid sudden price hikes can help keep your budget intact. In other words, if you’re expecting a price increase from a supplier, ordering materials in advance or locking in a contract before the hike can save you a significant amount of money.
2. Ripple Effect of Oil and Gas Pricing
Oil and gas prices have a direct impact on construction costs—particularly when it comes to transportation. Shipping costs for materials can increase sharply with rising fuel prices. This means that as oil and gas prices fluctuate, the cost of delivering materials from the manufacturer to the supplier, and eventually from the supplier to the job site, will also go up.
While it’s difficult to predict oil price fluctuations, staying updated on the global market can provide insight into when the best time to buy materials might be. This is especially important for projects that rely on bulk deliveries of materials like steel, concrete, or lumber.
3. Unforeseen Disruptions in the Supply Chain
Natural disasters can have significant long-term impacts on material supply. For instance, after Hurricane Helene devastated areas in the South, one of our timber connections informed us that three out of five of his timber providers went out of business due to the destruction. When a natural disaster strikes, the immediate effect is a disruption in the availability of building materials, which inevitably leads to price increases.
Similarly, the ongoing California wildfires have raised concerns about the availability of Douglas Fir, a common building material for wood-frame construction. As this tree is primarily grown on the western side of the U.S., any regional disaster—whether fires, floods, or storms—can limit supply and drive up prices due to higher demand.
While it’s impossible to predict when or where a natural disaster might occur, you can monitor regions where certain materials are sourced and plan your building schedule around potential risks.
4. Long-Term Supply Chain Impact
The ripple effects of tragic events extend far beyond the immediate damage caused. Consider the effects of the COVID-19 pandemic, for example. In 2020, global shutdowns led to a wave of factory closures and supply chain disruptions. While many manufacturers have recovered, the long-term impact on supply and demand has lingered, resulting in higher material costs and longer delivery times.
In addition, the loss of a local or regional supplier due to a tragic event often leads to increased demand for the remaining suppliers, which in turn causes prices to rise. If a specific material or resource becomes scarce, it’s not just about the immediate lack of stock but also the future instability of the supply chain.
5. Political Shifts and Trade Impacts
Every four years, the U.S. experiences the uncertainty of an election year, where tariffs, taxes, and policies can shift dramatically based on who assumes office. The construction industry is especially vulnerable to these changes because many materials—particularly mass timber like cross-laminated timber (CLT) panels—are imported from Canada.
New tariffs or changes in trade agreements can lead to increased material costs, especially for products that rely on international trade. For example, if there is a change in U.S.-Canada relations or new trade barriers are introduced, costs for timber may rise. Keeping an eye on the political landscape during election years can help you anticipate potential price hikes and adjust your project schedule accordingly.
When is the Best Time To Build?
To minimize costs, here are a few strategies:
- Buy Materials Early: If you anticipate a price increase, consider buying materials in bulk ahead of time or locking in prices through long-term agreements.
- Stay Flexible: Be prepared to adjust your project timeline if global or regional events affect material availability or delivery.
- Choose an Experienced Builder: You’ll never regret hiring an expert contractor to help you navigate the factors that influence fluctuating construction costs and supply chain challenges.
Ultimately, the best time to construct a new building depends on a careful assessment of your specific project’s needs and the broader market conditions. By partnering with an experienced builder, like Quarry View Building Group and staying informed about these key factors, you can make smarter decisions and avoid costly delays or unexpected price hikes.
Reach out to our team today to help you decide if now is the best time for you to build: https://quarryviewbuildinggroup.com/contact/
