How the surge in home improvements is placing Yorkshire's construction industry under pressure and risking delays in building projects

Yorkshire’s construction industry is facing delays and soaring costs as demand rockets for building materials, it has been claimed.

Commercial and residential property developers are seeing increases in costs for raw materials as high as 30 per cent owing to a boom in demand and the pandemic impacting shipping costs.

Leeds developer Gent Visick (GV) said that steel prices in the region have risen by an average of 20 per cent since January and that timber has soared by 30 per cent.

Sign up to our Business newsletter

Sign up to our Business newsletter

To compound matters for the industry, many contractors are having to take additional financial pressures owing to the fluctuation of tender prices which are increasing their initial costings, with the value of materials changing in some cases on a day by day basis.

Home improvement work has boomed of late.

GV’s building consultancy division director Gavin Ritchie said the volatile situation was likely to continue until supply caught up with demand.

He said: “The current levels of demand for construction materials in the UK is having a big impact in Yorkshire We’re currently seeing major shortages of common products including cold rolled steel, cement, chipboard and cladding.

“Part of the problem is that lots of construction projects have started at the same time, as the country emerged from lockdown, and the high numbers of people doing home improvements has also been well-publicised.

“This has all created a huge surge in demand and to make matters worse, the pandemic has pushed up shipping costs.

The construction industry has seen delays and price fluctuations.

“As a result, timber prices have significantly increased, and steel prices are already up by a fifth since the start of the year and we predict they could increase by another 20 per cent by October.”

Mr Ritchie’s warning comes after the Construction Leadership Council last month warned that cement, some electrical components, timber, steel and paints are all in short supply owing to “unprecedented levels of demand” with the Federation of Master Builders predicting that some building firms may have to delay projects and others could be forced to close.

Mr Ritchie added: “These price increases and delays securing products are now impacting on the timings of projects.

“Plus, contractors are struggling to fix tender prices because in some cases prices for materials are changing each day. This also means actual build costs have frequently increased dramatically from when estimates and initial appraisals were carried out, which can often be 12 months before work starts.

“Depending on how contracts are worded, contractors are often having to take the hit for these price increases and delays, which puts them under additional financial pressure at an already difficult time.

“It’s a challenging situation, which is likely to continue until supply catches up with demand.”

The company is also currently advising on several large-scale developments including more than one million square foot of new industrial space at two sites in Thirsk and Doncaster.