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Re: Is there a correlation?

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I must admit I find it interesting that new residential construction, even though the pace has slackened a bit, the costs on a square foot basis continue to escalate. This is occurring even though the last two years have seen a decrease in material cost for basic lumber in my area (With OSB below $7 and  precut studs in the $2.30 range, very close to their values back in 2001, and down 50-70% from their peaks).  Obviously copper is up (though many production plumbing shops are switching to PEX), as is concrete and rebar, but I'd say that materials aren't driving the cost of prescriptive building more than 15% or so.

I raised my rates in 2005 by 10%, and skipped last year.  I'm considering raising them again in January, maybe 10-15%.  Heading into the "slow" season my delivery dates seem to be extending, not receding.   I'm busy enough that I'm considering hiring another engineer.

As for taboo subjects, I would say that this is hardly a forum where price collusion could occur - it's a primarily a technical venue. Besides, given our geographic distribution and apparently small representation of the practicing field, we would neither come to any common ground on pricing nor affect the industry in any meaningful way.
Jordan


Bill Allen wrote:

I know this is a taboo subject, but I was reading the OC Register yesterday (sports section of course, since there’s an article every day on my beloved USC Trojans) and read an article about the proposed stadium for that fictitious future NFL team destined for the Los Angeles area. One point that was made was that the cost of the stadium has increased from the estimate in 2003 partly due to a 26% increase in construction costs including labor and material.

 

I haven’t raised my rate in a while, but this article got me thinking about it. On one hand, what I do has nothing to do with China taking all of our steel and wood products. On the other hand, I’m busier than *heck* and I’m canceling weekend motorcycle jaunts to meet deadlines.

 

I know we can’t talk about fees, but has anyone else made “adjustments in their business practice” since 2003?

 

Regards,

 

T. William (Bill) Allen, S.E.

ALLEN DESIGNS

Consulting Structural Engineers
 
V (949) 248-8588 F(949) 209-2509

 

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