In the dynamic world of construction in Sri Lanka, the year 2024 unveils significant shifts in cost considerations for building houses. Despite facing unprecedented challenges, the sector is witnessing a positive transformation marked by controlled inflation and eased import restrictions.
The trajectory of construction costs, which surged in mid-2022, underwent a notable change in 2023. Certain raw material prices experienced slight increases, while others witnessed decreases. Data from the Construction Industry Development Authority reveals nuanced fluctuations, including a 4% increase in cement bag prices and a 2% uptick in river sand prices, juxtaposed with significant drops in reinforcement steel and cement prices.
According to the House Price Index of LankaPropertyWeb for Q4 of 2023, incremental price changes are primarily attributed to controlled inflation and eased import taxes. Conversations with developers and real estate agents underscore the influence of these factors on house and apartment prices in Sri Lanka.
Beyond material prices, various factors significantly impact the financial landscape for homeowners, including location, land and house size, design intricacies, architect/engineer fees, material choices, construction workforce, project duration, and basic furniture costs.
Here’s a breakdown of the cost considerations:
- House Size: Costs range from Rs. 3-5 Million for smaller dwellings to Rs. 150-900 Million for spacious holiday properties.
- Cost per Square Foot: The average cost per square foot for a basic house stands at approximately Rs. 20,000/= as of January 2024, while luxury fittings elevate the cost to around Rs. 30,000 per square foot and beyond.
- Architectural Design: Traditional vs. modern designs significantly influence costs, ranging from Rs. 8 Million to Rs. 600 Million.
- Architect Fees: Fees range from 1% to 8% of the overall construction prices or on a square feet basis.
- Materials: Costs vary, with bricks, cement blocks, roof tiles, and cement sacks priced differently.
- Construction Workers: Unskilled workers earn Rs. 60,000-70,000 per month, while skilled counterparts command Rs. 100,000-120,000.
- Furniture and Appliances: Essential furniture items add finishing touches, with costs varying for sofa sets, chairs, tables, cupboards, wardrobes, and beds.
As stakeholders navigate the evolving landscape of construction costs, the positive changes witnessed in 2023 reflect the resilience and adaptability of the industry. Controlled inflation and eased import restrictions empower informed decision-making, fostering a promising outlook for the construction sector marked by sustainable growth and innovation.