UAE developers watch out: project costs are shooting up all over, says Danube's Anis Sajan
Key building material prices such steel rebars are gaining in a matter of days
Building material prices still have some way to go in the UAE.
Rebar prices have gone up from Dh2,500 a tonne to Dh3,100 in the past few days alone, which is by more than 20 per cent. Raw materials like iron ore and scrap to make billets had spiked, which is why rebar is seeing this kind of upward mobility. shooting so high.
In December, the UAE price for a rebar was Dh2000, which touched Dh2,500 in March and now taken a sudden jump to Dh3,100. Similarly, the price for white wood - another basic product for construction - has also shot by 20 per cent. There is huge demand from all over, and prices will further go up. Brass prices are 25 per cent costlier in the last two months.
Paying the price
Importers were by playing a waiting game by not shipping in for a while thinking prices will go down. Instead, they are caught in a situation prices are still gaining and they have run out of stock. They have no choice but absorb the price increase to continue their business.
This will definitely impact developers’ costs by at least 2 per cent and even further. It is a steep cost to pay just as property values are picking up again and showing clear signs of further improvements.