"Global construction volume is on the up and the future is looking bright. But the industry faces more work with fewer workers. The challenge for the supply chain is how to convert this increased output into profit."
The 2018 international construction market survey brings together data and experience from 46 markets around the world, to provide an insight into the current state and direction of travel of the global construction industry. This year it also brings optimism.
Three new markets entered the analysis for the first time this year: Ho Chi Minh City, Jakarta and Shanghai.
Global construction costs are expected to rise 4.3 percent in 2018 following a 4.0 percent rise in 2017.
21 of the 46 markets measured are expected to warm up in 2018, just two are expected to cool.
New York once again holds the top spot for highest construction costs, ahead of Zurich.
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Perth and Muscat were the only two markets to see falls in construction costs.
Five markets were identified as running hot and three, Amsterdam, San Francisco and Seattle, were seen to be overheating.
There are signs that some weaker performing commodity driven markets are set to warm in 2018, notably Perth and São Paulo.
3 Global economic overview
Navarro Anthrazit Mens Anthrazit Black amp; Trekking Bruetting Grau Shoes Grau Hiking A decade on from the global financial crisis and the world economy is finally reaching cruising speed. 2018 looks positive for employment, business profits, investment and construction.
The USA is enjoying rapid economic growth, European markets are catching up, China continues to surprise but there is uncertainty in the UK due to Brexit.
Our ratings of markets as cold, lukewarm, warm, hot or overheating rely on several interrelated factors. In a cold market there is typically intense competition among contractors for very little work, reducing cost pressures.
Markets are considered warmer as competition decreases and prices begin to rise, as demand increases in relation to supply.
The five most expensive locations are New York City, San Francisco, Hong Kong, Zurich, and London.
New York City retained its position as the most expensive place to build in the world even though building spend dipped in 2017. But that was from an all-time high in 2016 and growth in construction spending is set to resume in 2018 stretching resources.
Anthrazit Grau Trekking Grau Black Mens amp; Bruetting Shoes Hiking Anthrazit Navarro Top five most expensive places to build
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Anthrazit Black Trekking Grau Mens Hiking amp; Navarro Bruetting Anthrazit Grau Shoes Last year’s report noted a rise from 20 to 24 markets registering skills shortage. This year the number has risen to 27, albeit from a slightly larger sample.
Preliminaries and margins are two other drivers of overall construction costs.
10.3% The average preliminaries globally in 2018
15% Preliminaries in Tokyo and Buenos Aires in 2018
5% Preliminaries in Madrid in 2018
The average margin globally in 2018 was 6.4 percent, but margins ranged between 15 percent in Kuala Lumpur to 3 percent in Northern Ireland. In broad terms, changes within a given market over a short period are one indicator to take into account when assessing market activity and cost pressures.
Conducting an analysis across markets by converting costs to a single currency can allow for direct comparison between markets. However, any devaluation or revaluation of a currency impacts both the wage levels and the overall construction cost.
10 Comparing construction costs; Terms and references
It is important to compare construction costs between countries to inform expansion decisions. It can enable productivity comparisons and highlight how different practices and tools such as BIM can improve design and delivery.
Anthrazit Grau Black Shoes Bruetting Hiking Trekking amp; Anthrazit Grau Mens Navarro Opportunities to improve the efficiency of the construction sector and reduce costs are also opportunities to grow the global economy faster.