May 21, 2022

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The costs of building a home are rising and could get worse

The costs of building a home are rising and could get worse

Price increase from 20 to 100 percent. These are tough times for both homebuyers and homebuilders. Hardly any construction project can be carried out according to the original agreements. “I can’t see the future, which is why I think it’s important to always stay in touch with clients.”

Profile photo of Imke van de Laar

Mark Hotsma is a construction company owner in Mierlo and a contractor. He empathizes with the people for whom he builds a home. But he would be a thief out of his pocket if he did not pass on the ever-increasing prices of building materials to his customers.

The high voltage in construction (Photo: Imke van de Laar).
The high voltage in construction (Photo: Imke van de Laar).

“The prices are already going up. Normally, costs increase by three to five percent per year. Insulation materials are now twenty to thirty percent more expensive in a few years. I also have to pay thirty to forty percent more for facing bricks. The price of lumber has probably gone up by One hundred percent,” Hotsma sums up.

He and his colleagues in the construction industry face this every day. “These are really huge price increases that the whole industry is dealing with. Every day we get emails that the materials to build a house, from foundation to edge, are getting more expensive again. It simply can no longer be fixed price agreements, because you don’t know what Which can happen. And then transportation costs increase as well.”

Hotsma knows that the extra cost of energy is the biggest culprit. “You need natural gas to produce bricks or roof tiles. But glass has also become very expensive. On top of that, additional fees are actually charged across the board when products are purchased.”

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“Everywhere the material comes from, it spoils.”

The building contractor cites a few other reasons for the ongoing price increases. “He is very busy building. Many homes have to be built, and for this reason, there is a shortage among merchants. Moreover, the war in Ukraine is not cooperating. Everywhere the material comes from, things get messy,” Houtsma says.

There is still a lot of work to be done (Photo: Imke van de Laar).
There is still a lot of work to be done (Photo: Imke van de Laar).

If we are to believe it, the end is not yet in sight. “It will be some time before we get back to normal, if we can go back there. I find it especially difficult for clients. They don’t know where they stand. It is already expensive to build a house, but with increasing costs and increasing quality requirements from the government, it is no longer cheaper.” For example, the insulation has to be thicker and there are more rules that a new home has to adhere to.”

And he continues, “In the meantime, the price is only going up. I find all of this worrying. I think in the long run we will return to the state of crisis and not get out of the vicious circle.”

“Search for alternatives with the client.”

Houtsma finds it extremely important to stay in touch with his clients. “Even before the project started, I explained to them the possible price increases and what the consequences could be. For example, we came up with alternatives to materials whose prices had risen exorbitantly. This way we try to accommodate customers so that we can continue to work within the agreed budget.”

High construction costs are not the only reason why construction projects are sometimes slow. In this video we explain: