COST OF HOME REPAIRS INCREASES BY 3.35% FROM Q3 2023 ACCORDING TO THE Q3 2024 VERISK REMODEL INDEX
Price increases continue to slow down after post-COVID surge, but have risen almost 70% in the past decade The cost of home repairs and remodeling in the third quarter of 2024 continued to increase, rising by 1.08% from the prior quarter and just over 3.35% from the third quarter of 2023 according to the Q3 2024 Verisk Remodel Index. Costs set new highs for the past decade, rising over 69.5% from the first quarter of 2013. The Verisk Remodel Index tracks costs on 31 different categories of home repair, covering over 10,000 line items ranging from appliances to windows. Data are compiled monthly in over 430 local market areas across the country. “Repair and remodeling costs continue to increase across the country, but the rate of increase is returning to pre-pandemic levels,” said Greg Pyne, VP, Pricing for Verisk Property Estimating Solutions. “In the most recent quarter, those increases appear to have been driven largely by increased labor costs rather than rising material prices.” The two categories reporting the highest quarterly increases – painting the exterior of a home, which rose 3.36%, and replacing tile flooring, which rose 2.18% – are two jobs where labor costs comprise a very high percentage of the cost of the job. Almost 55% of exterior painting costs are from labor, while almost 64% of the cost of replacing tile flooring is from labor. Quarterly cost trends varied across the 31 categories included in the report: prices increased in nine categories; stayed the same in eight; and decreased in 14. Some notable changes in costs: Concrete and Asphalt, which accounts for about three percent of repair costs nationally, saw costs rise by 0.12%, the highest increase among all the categories; Siding, which makes up the largest percentage of costs, rose 0.7%; and Cabinetry had the largest quarterly decrease in costs, falling by 0.11%. Quarter-over-quarter repair and remodeling costs rose more quickly than home prices during the same period, up 1.08% compared to a 0.2% quarterly increase according to price information reported by ATTOM in its Q3 2024 Home Sales Report. Conversely, home prices rose at a brisker pace than repair and replacement costs over the past year – 5.3% to 3.35%. Both home prices and repair costs outpaced the rate of inflation in the third quarter, when the government’s Consumer Price Index sat at 2.1% and the Personal Consumption Expenditure Index was 2.2%. South Atlantic and Mountain States Have Highest Quarterly and Annual Gains All regions again experienced cost increases both quarterly and annually. Quarterly increases ranged from a low of 0.84% in the East South Central and West South Central Regions to 1.21% in the Mountain Region. All regions experienced annual increases of over three percent, ranging from a low of 3.03% in the West South Central Region to 3.68% in the South Atlantic Region. These numbers confirm that repair and remodel costs may be moderating, according to Pyne. “A year ago, annual increases were over five percent in every region, and over six percent in the East North Central, Mountain, and New England Regions. So it does appear that while prices continue to rise, they’re doing so at a slower pace.” Q1-Q2 2024 Q2-Q3 2023 Q3 2023-2024 East North Central 1.12% 0.94% 3.26% East South Central 1.14% 0.84% 3.23% Mid-Atlantic 0.95% 0.90% 3.08% Mountain 1.21% 1.21% 3.58% New England 1.09% 0.86% 3.24% Pacific 1.03% 0.90% 3.04% South Atlantic 1.03% 1.49% 3.68% West North Central 1.19% 1.17% 3.48% West South Central 1.01% 0.84% 3.03% Northeastern States Have Both the Highest and Lowest Rates of Increase Washington, D.C. had the highest quarterly rate of increase in the country at 3.76%, the only area to surpass a two percent increase for the reporting period. Delaware (1.95%), Utah (1.79%) and Kansas (1.66%) and Montana (1.59%) all reported increases over 1.5%. Kentucky had the lowest rate of cost increases at 0.62%, followed by Oklahoma (0.66%), Arizona (0.68%), Arkansas (0.70%), and Mississippi (0.70%). Methodology The Verisk Remodel Index tracks costs on 31 different categories of home repair, comprising over 10,000-line items including appliances, doors, framing, plumbing, windows. Prices are compiled and updated monthly in over 430 local market areas across the country. The index cost basis is January 2013, and the report is updated quarterly. About Verisk Verisk is a leading strategic data analytics and technology partner to the global insurance industry. It empowers clients to strengthen operating efficiency, improve underwriting and claims outcomes, combat fraud and make informed decisions about global risks, including climate change, extreme events, ESG and political issues. Through advanced data analytics, software, scientific research and deep industry knowledge, Verisk helps build global resilience for individuals, communities and businesses. With teams across more than 20 countries, Verisk consistently earns certification by Great Place to Work and fosters an inclusive culture where all team members feel they belong. Verisk is traded on the Nasdaq exchange and is a part of the S&P 500 Index and the Nasdaq-100 Index. For more information, please visit www.verisk.com. Contact: Rick Sharga CJ Patrick Company (949) 322-4583 rick.sharga@cjpatrick.com Author admin View all posts
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