Data from the General Authority for Statistics revealed that construction costs rose during August 2026, after the construction cost index recorded an annual increase of 2.3% compared to the same month last year, driven by rising construction costs in the residential and non-residential sectors.
The index data showed that construction costs in the residential sector rose by 2.1% year-on-year, while the non-residential sector recorded a larger increase of 2.6%.
High residential construction costs
The rise in construction costs for the residential sector came as a result of the increase in a number of key cost components, with the costs of basic materials increasing by 1.8%, driven by a rise in the prices of metal products by 2%.
Equipment and machinery rental costs also increased by 4.1%, as a result of increased equipment and machinery rental costs with an operator by 5.6%.
Labor costs in the residential sector rose by 5.1%, while energy prices increased by 3.0%, which contributed to pushing the residential index up during August.
The non-residential sector is recording a larger increase.
In the non-residential sector, the construction cost index rose by 2.6% year-on-year.
The increase was mainly driven by a rise in equipment and machinery rental costs by 5.8%, with equipment and machinery rental costs with an operator rising by 7.2%.
Labor costs for the non-residential sector also increased by 2%, while energy costs increased by 3%. At the level of basic materials, costs recorded an increase of 1.8%, as a result of an increase in the prices of other building materials by 4.3%, along with an increase in the prices of timber and trade by 2.1%.
Limited monthly increase
On a monthly basis, the construction cost index rose by 0.1% in August 2026 compared to last July.
This increase came as a result of higher construction costs in both the residential and non-residential sectors, by 0.1% each.
51 items that measure construction costs
The Construction Cost Index (CCI) reveals price movements in construction input costs and consists of 51 items whose prices are collected monthly from 13 regions.
Data is collected through field visits to contractors' offices, engineering firms, and building materials retailers, with 2023 set as the base year for the index. Construction cost index statistics are published monthly, providing an indicator of the movement and changes in construction sector input costs over time.
