Construction costs in the UK - statistics & facts

During the past years, construction costs have increased a lot in the United Kingdom. There are several types of expenses that contractors need to consider when starting any project. Some of the most relevant ones are the price of raw materials, fixtures and fittings, and equipment, but also labor costs, and the price of development land.

Why do construction costs increase?

Since 2020, the industry has faced several challenges that have constrained the building activity of the UK and caused some of the aforementioned expenses to increase. Firstly, since the start of the COVID-19 pandemic there have been supply-chain disruptions, which have caused shortages of construction materials. When supply decreases, but demand remains stable, prices tend rise. Additionally, there has also been a shortage of skilled labor, while the number of job vacancies in the construction sector has soared. Finally, inflation and the increasing energy prices have had an impact on the industry overall, with the annual growth rate of construction costs reaching nearly ten percent in 2022.

Construction costs worldwide

Some of the most affordable cities to construct a high rise were located in China, Southeast Asia, and South Africa. New York was on the other side of the spectrum, closely followed by London, Sydney, and Hong Kong. There were also other cities in the U.S. with very high residential construction costs, such as Honolulu and San Francisco. The latter was in fact the U.S. city at the top of the ranking for multi-family housing, with an average expense of nearly 500 U.S. dollars per square foot. Along with the entries above, Switzerland was also a really expensive place to build in: Geneva and Zurich were the two cities with the highest construction costs in Europe. London was the third city in that ranking, with a figure just below 4,000 U.S. dollars per square meter.
This text provides general information. Statista assumes no liability for the information given being complete or correct. Due to varying update cycles, statistics can display more up-to-date data than referenced in the text.
Published by Statista Research Department, May 25, 2023

Key insights

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