CoreLogic® curates this monthly bulletin of regional construction cost insights, which are reflected in the CoreLogic Claims Pricing database. We combine the current month’s pricing data with four common loss scenarios to create models illustrating market impacts across nine regions, which are compared month over month and year over year.
Our experts provide detailed analyses of changes and trends to provide additional insight into key drivers. View our Construction Database Pricing Methodology white paper to gain additional insight into how we populate cost values.
October Pricing Insights
Maui Wildfire Pricing
In response to the recent wildfires on Maui, we are introducing a ‘Kahului Database’ in the October pricing release. This new pricing region will allow for more flexibility to accurately capture and report the micro-economic influences affecting labor and materials pricing on the Hawaiian island of Maui.
Throughout the latter half of 2022 and the first half of 2023, the CoreLogic Pricing Data Team has observed extraordinary pricing volatility within building materials containing wood-based products. To stabilize these fluctuating prices, the October 2023 Pricing Database will realign certain wood-based products to better reflect the trend of a less volatile pricing environment.
This realignment will result in select markets experiencing a higher-than-average upward adjustment to specific wood-based material prices like cabinetry. These adjustments reflect CoreLogic’s view that material pricing in many categories is stabilizing within the building material marketplace.
In addition, the team is actively monitoring, researching, and validating increases in material costs for the asphalt shingle category, a material whose price is directly tied to the price of petroleum products. Increasing oil prices may continue directly impacting manufacturing costs and ultimately material prices. Adjustments to asphalt shingle material prices will be applied as appropriate across all regions.
Upcoming Changes for Q4 2023
The CoreLogic Pricing Analysis and Delivery Team is currently working on the research and development of new trade crews and associated labor changes for the siding and soffit, fascia, and gutter categories. These updates will be delivered in the December 2023 Pricing Database, and additional details outlining these changes will be provided in that release.
Fire/Lightning (Large Loss) Insights: 12-Month Trend
In this category, large loss claims are modeled from a typical fire loss where all components of a home’s construction are affected. Losses typically exceed $100,000.
- For October the fire/lightning loss scenario increased across all regions by an average of 1.2%. The year-over-year pricing rose on average by 0.5% for all regions. This average increase over October 2022 pricing is skewed with some regions seeing larger increases. In the Central, Gulf Coast, and Northeastern regions, prices increased by 1%. In the West Central region, prices rose 2%.
- The labor component has been stable month over month and has not contributed to the monthly scenario increase. Compared to this time last year, labor rates remain elevated and do contribute to the inflation of the loss scenario over 2022 pricing.
- As discussed in the opening insights, cabinetry materials have increased this month to realign with market pricing. The average adjustment for the regions is 14.5%. The Central and West Coast regions exceed this average at 18% and 22.3% respectively, while the Southeast falls below the average at 8.4%. The adjustments taken to the cabinetry pricing are reflected in the upward movement of this scenario this month.
Wind/Hail (Exterior/Roof) Insights: 12-Month Trend
This category represents losses due to wind and/or hail weather activity. Restoration from this damage requires roof replacement, partial siding replacement, and accompanying accessories.
- From August 27 – September 22, there was a noticeable decline among events with 1-inch or greater hail, both in the number of states and the number of homes that experienced damage. CoreLogic Weather Verification Services indicated that during this period, 275,000 homes across 30 states were impacted, with Texas nearing 40,000 homes damaged. On September 8, 2023, nearly 25,400 homes in Virginia were struck by 1- to 2-inch hail.
- As expected, with the large number of notable hail events in 2023, this loss scenario is 4.3% higher on average than October 2022 pricing. All regions for this loss scenario remain elevated with the Gulf Coast, Central, Northeast, and West Central regions nearly 1% higher than this average. As discussed earlier in the bulletin, the CoreLogic Pricing Data Team is monitoring the market for price adjustments in roofing material as well as other exterior building materials.
- Window material pricing continues to be elevated, averaging 4.7% higher than last year at this time. The West Central region is significantly higher with prices up 10.3%, followed by the Central region where prices are elevated 7.7%, the Southwest saw increases of 6.4%, and the Gulf Coast had prices rise 5.7%.
Water (Interior Reconstruction) Insights: 12-Month Trend
Moderately complex losses are modeled for the interior water loss scenario using the bathroom as the origin of loss where a combination of replacement and repair of common household finishes is required.
- Pricing for the water interior reconstruction scenario has remained relatively stable since July 2023. This month it declined less than 1% across all regions. The year-over-year comparison declined slightly and was just over 2.7% higher than October 2022 levels.
- Though the monthly movement for drywall materials was less than 1% on average across all regions, it remains 13.9% higher year over year. The Central and Southeast regions surpassed that mark, with gains of 14.6% and 16.3%, respectively. Another material category, paint, exceeds 2022 pricing by 4.3% on average.
- Mirroring the overall movement of this loss scenario, labor rates have leveled since July 2023 with no month-over-month movement. Applicable loss scenario labor rates remain 4.6% higher than rates from a year ago.
Water Mitigation (Drying) Insights: 12-Month Trend
Typical drying costs for a residential structure include water extraction, wet material removal, and drying equipment use.
- For the last four months, the water mitigation scenario has experienced less movement month over month. For October, a slight decrease occurred, averaging 0.06% across all regions.
- The correlation between the scenario pricing and labor rates for water mitigation technicians is evident; labor rates have also been stable for the last four months.
- Compared to October 2022, the water remediation scenario is 3.2% higher on average for all regions. The Northwest and West Central regions beat that average at 5% and 6%, respectively.
About CoreLogic Data Research
CoreLogic develops this report using up-to-date materials and labor costs. CoreLogic’s team of analysts continuously researches hard costs such as labor, material, and equipment, including mark-ups. CoreLogic updates its database every month accordingly.
Our research also covers soft costs such as taxes and fringe benefits for reconstruction work performed as part of the insurance industry. CoreLogic monitors demographics and econometric statistics, government indicators, and localization requirements, including market trends from thousands of unique economies throughout the United States.
Other factors in this process include the following:
- Wage rates for more than 85 union and non-union trades
- Over 100,000 construction data points
- Productivity rates and crew sizes
- Building code requirements and localized cost variables
Additionally, we validate cost data by analyzing field inspection records, contractor estimates, phone surveys, and both partial and complete loss claim information.
Please complete the online form to provide feedback or request information on any items in our construction database. Please contact your sales executive or account manager for additional explanations or questions. A more detailed methodology explanation can be found in our Construction Database Pricing Methodology white paper.
CoreLogic is a leading global property information, analytics and data-enabled solutions provider. The company’s combined data from public, contributory and proprietary sources includes over 4.5 billion records spanning more than 50 years, providing detailed coverage of property, mortgages and other encumbrances, consumer credit, tenancy, location, hazard risk and related performance information. The markets CoreLogic serves include real estate and mortgage finance, insurance, capital markets, and the public sector. CoreLogic delivers value to clients through unique data, analytics, workflow technology, advisory and managed services. Clients rely on CoreLogic to help identify and manage growth opportunities, improve performance and mitigate risk. Headquartered in Irvine, Calif., CoreLogic operates in North America, Western Europe and Asia Pacific. For more information, please visit stage.corelogic.com.
NOTE: The building material, labor, and other cost information in this bulletin is generated using research, sources, and methods current as of the date of this bulletin and is intended only to provide an estimated average of reconstruction cost trends in the specified general geographic regions of the United States. This cost information may vary further when adjusting claim values for specific property locations or specific business conditions.