Xactware Industry Trends Bulletin Key Pricing Trends
This bulletin gives a brief overview of recent pricing trends in the property insurance, construction, and restoration industries.
As a reporter of market-specific pricing information for repairing or rebuilding structures and replacing personal property, Xactware conducts hundreds of thousands of industry surveys, and reviews more than 100 million data points per year submitted through field estimates written by contractors and adjusters as well as electronic data feeds provided by retail merchants. This extensive library of research enables Xactware to provide a comprehensive report of important industry trends.
Material costs are highly variable and are sometimes impacted by factors such as fuel costs, changes to industry practices, or natural disasters. Xactware closely monitors a wide variety of material costs across the country to ensure its price lists reflect any recent changes to pricing.
In the fourth quarter of 2019, Xactware observed cost increase to most material categories. The exception was lumber material costs which decreased 0.85 percent over the quarter and 6.31 percent since January 2019. The other significant change occurred in the cost of interior trim material which increased 2.03 percent over the quarter and 5.42 percent over the year.
The Material Composite Index report tracks a combination of several commonly used material components, including floor covering, paint, and roofing among others. The index showed a 0.44 percent cost increase in the fourth quarter of 2019 and 2.49 percent cost increase since January 2019.
Xactware’s Pricing Data Services also surveys thousands of contractors across the country each month to determine what they charge for labor. The most significant change observed in key labor categories occurred in the labor cost of a drywall installer and finisher, which increased 2.47 percent over the fourth quarter of 2019 and 9.21 percent since January 2019.
The Retail Labor Index report tracks a combination of several common trades, including floor covering, painting, and roofing. In the fourth quarter of 2019, the index showed a 1.11 percent cost increase. Between January 2019 and January 2020, the index showed a 4.49 percent cost increase.
However, the individual trades that contribute to the Retail Labor Index varied in their percent change over the quarter. The most significant quarterly change occurred in the labor cost of a commercial superintendent which increased 3.95 percent since October.
The combined labor and material report is based on monthly building cost data published by Xactware. It comprises a set of commonly used items and may be used as an indicator of trends within the marketplace. The combination of labor and materials makes up the majority of Xactware price list items. Tracking the percent change for the cost of these items provides a good gauge of the general market.
The Combined Labor and Materials report showed a cost increase of 0.69 percent in the fourth quarter of 2019 and a 3.37 percent increase since January 2019.
Fuel costs are extremely volatile and are a factor in item pricing. Low oil prices can push down the price of some raw materials. During the fourth quarter of 2019, fuel costs decreased 2.80 percent, and they increased by 13.46 percent since January 2019.
Xactware’s Pricing Data Services carefully tracks fuel costs to ensure accurate pricing.
Where to Learn More
Annual Property Report
Xactware publishes annual property reports that focus on key trends during the previous calendar year. To order Xactware’s Property Report for the United States or Canada, please visit the Xactware Online Store.
Industry Trend Reports
Using Industry Trend Reports, Xactware customers can examine pricing trends on national, state or province, and local levels for key material and labor pricing changes in multiple trades. Trends can be viewed by the month or over extended periods of time. For more information about Xactware’s Industry Trend Reports, or to receive access to them, please contact your sales representative or call 1-800-424-9228.
Pricing Methodology White Paper
For more information about Xactware’s methodology for researching and publishing pricing information, please see the Pricing Research Methodology white paper on the eService Center.
Unless otherwise stated, the values reported in this bulletin are national averages for the United States and will vary from local prices.