Construction costs show yearly rise of 2.6%

CONSTRUCTION costs increased by an average of 2.6 per cent annually over the last five years, according to the latest index from the Society of Chartered Surveyors. The findings reflect higher labour and material costs but the society says prices remained static because contractors had absorbed the extra costs. There were few indications that lowest tender prices were moving upwards in excess of trends. With construction showing real growth again for 1996, it was conceivable prices would rise and if this happens, it may well be in excess of the cost index as contractors attempt to recover lost ground.