Construction costs in the 4th quarter of 2005

18.01.2006

Compared with the 4th quarter of 2004, construction costs in Latvia in the 4th quarter of 2005 rose on average by 13.6%, according to the Central Statistical Bureau. The most rapid rise (by 26.5%) could be seen in the labour remuneration of workers. The maintenance and operational costs of machinery and equipment increased by 13.4% and the prices of construction materials rose by 8.6%. The most notable increases in construction costs were 18.0% in the construction of transport facilities, 17.5% in the construction of underground main pipelines and 17.4% in the renovation of office buildings. There were increases of 12.7% in the costs of reconstruction and construction of industrial, agricultural and trade buildings and 10.3% in the construction of family houses. By contrast, construction costs in the renovation of education and health protection buildings decreased by 2.5%.

Compared with the 3rd quarter, construction costs in the 4th quarter of 2005 increased on average by 5.4%. The steepest increase was in the labour remuneration of workers (by 17.2%). The increases were 1.5% in the maintenance and operational costs of machinery and equipment and 0.9% in the prices of construction materials. The highest cost increases could be observed in the renovation of office buildings and construction of underground main pipelines (by 11.1% and 7.8%, respectively). There were the following increases in the construction costs: 5.3% in the reconstruction and construction of industrial, agricultural and trade buildings, 4.0% in the construction of transport facilities as well as in the construction of family houses and 2.6% in the renovation of education and health protection buildings.

Compared with 2004, construction costs in 2005 in Latvia rose on average by 11.4%. It is worth noting that such a steep rise in construction costs had not been observed for already 10 years (since 1995). Labour remuneration of workers has increased most rapidly (by 16.1%). The maintenance and operational costs of machinery and equipment went up by 13.8% and the prices of construction materials increased by 9.6%. The sharpest rise in construction costs occurred in the construction of transport facilities and underground main pipelines (by 16.6% and 15.0%, respectively). There were the following increases in the construction costs: 10.9% in the renovation of office buildings, 10.3% in the reconstruction and construction of industrial, agricultural and trade buildings and 8.9% in the construction of family houses. A fall of 1.8% in the construction costs could be observed in the renovation of education and health protection buildings.

Prepared by the Producer Price Indices Section
Department of Price Statistics
Tel. 7366813

Aleksandrs Grzibovskis