According to information released by Statistics Estonia on January 20, the average construction price index in 2019 increased by 1.9% YoY. In the fourth quarter of 2019, the construction price index increased by 0.5% QoQ and by 1.7% YoY.
In 2019, compared to the 2018 average, the cost of labor increased by 4.3%, the use of machinery by 2% and building materials by 0.7%.
In the fourth quarter of 2019, compared to the third quarter of 2019, the index was affected primarily by an increase in the cost of materials, which accounted for 44% of the change. The increase in labor costs also accounted for half of the on-year increase in the index in the fourth quarter 2019.
The repair and reconstruction work price index in 2019 rose by 2.2% YoY, including a 4.4% increase in labor costs, a 5.3% increase in the use of machinery and a 0.4% increase in the cost of materials. In the fourth quarter of 2019, the index increased by 0.5% QoQ and by 1.9% YoY.
The calculation of the construction price index covers four groups of buildings: detached houses, apartment buildings, industrial buildings and office buildings. The repair and reconstruction work price index covers office buildings.
The construction price index expresses the change in construction expenditures taking into account the price changes of three basic inputs: labor force, building materials, and building machines. (ERR/Business World Magazine)