Will there be any effect of fuel prices on the construction cost…
Yes, it can effect because the material that we use in construction is dependent upon fuel. If fuel rates will be high then construction material cost will also increase and indirect effect on construction.
Have you seen any translation of this decrease in current period if see it on year on year basis …as i am planning to construct my house in near future…
FUEL prices should affect transportation charges.
AND inside Pakistan transportation depends on fuel ,so higher the fuel prices ,higher the transportation money.
BUT the current crises is only of limited days of less fuel availability ,and should not be misused by some monopolists.
OVERALL INTERNATIONAL fuel (petrol) prices have reduced to half , so in Pakistan it should be cheap as well , so less transportation charges, and reduced construction rates.
Rising fuel prices are said to influence everything from the cost of a child’s lunch to the price of a house. So yes, if fuel prices are falling, the construction costs are likely to fall as well. It is cheaper to transport the construction material to the construction site, which reduces the construction cost to a certain extent within itself.
Lets not forget, the major cost component of cement plants and a steel mills is furnace oil or for that matter the brick plants too. If this goes down surely you will see a price cut. However the impact will gel in slowly–maybe after a month or two you will see the proper effect.
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Definitely it will have an impact in coming days but will be slow.
If any one could please update the prices of cement, steel and bricks will be appreciated.
If wishes were horses......
Dear friends, businesses are set-up to generate profits not for providing welfare, for that you have Edhi. No business reduces the cost of its product due to a decrease in prices of its input. The only thing which makes them cut prices is decreased sales, for any reason.
Why would these products get cheaper when their producers are doing roaring business? For example cement factories are operating at almost 90% of maximum production capacity on average these days! Then why will they reduce prices and instead of pocketing that additional money themselves, hand it over to us?!
And just incase you are wondering how is that the possible, you need to look no further than our very own metro project. Huge government construction projects like these are generating tremendous demand, and the dams are still to come! So as long as the current government is in office, this trend is likely to continue.
Changes in fuel prices have impact on production/construction directly or indirectly.
As far as the construction industry is concerned, The major usage of fuel is through plant & machinery and transportation of material.
Transportation cost effects overall cost of material used in construction significantly when its transported from remote areas from sites. There are some types of materials which cost low itself than transportation cost i.e crush and sand.
I agree with Raza. Our country is not a free market, but in the hands of cartels. No one passes the benefits to ordinary citizens unless they get the stick. But I don’t think govt will give any stick to these people, because it is very close to builders and contractors.
Following link will help fellow members in understanding the effect of lower fuel prices on every industry...