“In fact, if you start building a simple home now relying on estimates of Rs 2 million done some six months ago, you will instantly find the budget falling short by Rs 600,000,” said Roshan Dahal, former president of Nepal Construction Materials Dealers Association (NCMDA), who is also a builder.
Construction cost has soared mainly following the heels of some two-third rise in the prices of cement and also more than two-fold rise in the prices of bricks over the period. These two products command 29 percent and about 12 percent weight respectively in the overall construction budget.Prices issued by the NCMDA shows that the prices of cement has soared by some 66 percent over the last six months. Mainly the short supply of Nepali cement and the subsequent hike in the prices by the manufacturers by Rs 250 per sack (50 kgs) has dragged the overall cement prices to a range of Rs 700 to Rs 750 per sack.
Six months ago, cement was priced Rs 465 per sack.
Likewise, the prices of brick also soared to Rs 6,500 and 7,000 per thousand pieces depending on quality and quantity of supply, which is a whopping 133 percent rise in prices compared to six months ago. Bricks were priced Rs 3,000 per thousand pieces six months ago.
Even though the prices of steel rods has dropped sharply, compared what prevailed in the market a year ago, its prices have inched up by some 18 percent over the last six months, said the suppliers of construction materials.
Six months ago, prices of steel rod had dipped to Rs 62 per kilogram in December 2008 - lowest over the last one-and-a-half years. Presently, it is priced Rs 73 per kg. Steel rod commands 29 percent weight in the overall construction budget, and any changes in its prices impact the budget accordingly.
The price of aggregates, which also occupies substantial weight on the construction cost, has also increased to Rs 42 per cubic feet from Rs 40 over the period.
Workers wage, one of the key input costs of construction work, however, has remained constant over the period and stand at Rs 150 to Rs 250 a day depending upon the level of skill and competence. The price of wood has also remained unchanged.
Price Movement
| Dec 2008 | May 2009 | |
| Cement | Rs 465/50 kgs | Rs 750/50 kgs |
| Rod | Rs 62/kg | Rs 73/kg |
| Bricks | Rs 3000/1000 pcs | Rs 7000/1000 pcs |
| Aggregates | Rs 40/cubic feet | Rs 42/cubic feet |