Between July 2023 and July 2024, total reconstruction costs in the United States, including materials and retail labor, increased by 5.2 percent, according to a recent report by Verisk.

This is a significant increase over the cost growth posted between July 2022 to July 2023 (4.0 percent) and over the cost growth in Q2 2024 (1.6 percent), the 360Value Q3 Reconstruction Report showed.

Total residential costs increased 4.9 percent from July 2023 to July 2024 and 1.4 percent from April 2024 to July 2024.

Residential reconstruction costs increased year over year in all states.

Total commercial reconstruction costs increased 5.5 percent from July 2023 to July 2024 and 1.8 percent from April 2024 to July 2024.

Commercial reconstruction costs increased by at least 3.42 percent in all states, the Verisk report showed.

Material costs rose by 4.35 percent from July 2023 to July 2024, though that growth wasn’t evenly distributed by month, the report noted.

Material cost increases are accelerating compared to 2023: growth from January 2024 to July 2024 has already surpassed the total growth for 2023, increasing 1.75 percent compared to 2023’s total of 1.20 percent.

If the trend continues, material costs will have an increase of 3.00 percent in the U.S. for 2024, Verisk noted, more than double 2023’s growth.

Combined hourly retail labor costs increased by 4.3 percent from July 2023 to July 2024, a significant drop from their 6.2 percent increase from January 2023 to January 2024. However, the quarterly change was 1.36 percent compared to last quarter’s 1.05 percent increase.

For the first time in years, materials costs rose more than labor costs: 4.35 percent for materials vs. 4.31 percent for labor.