Increase in House construction cost from 2017 to 2022

Increase in House construction cost

House construction industry is the major sector that keeps the wheel of economy running all the time. It creates huge amount of jobs and keeps various industry running that is directly or indirectly related to housing. This sector always has a huge potential to absorb skilled and unskilled workforce hence creating employment and reducing poverty in country. In Pakistan an estimated 750000-850000 houses are annually required to meet the housing needs as per the current growth. However every year we are able to construct only 250000-300000 houses only, leaving behind a big gap in demand and supply.

Team overc’s started educating people about house construction costs back in 2017. House construction cost videos were updated on yearly basis however no cost video was uploaded in 2021 due to continuous material price variations in market. In this video we have compared latest 2022 grey structure cost per sqft figure with 2017 grey structure cost. Each main material price comparison has also been provided for better understanding the huge price difference of around from 2017 to 2022. In last 5 years only, house construction cost has gone up by whooping 98% approximately! that means an inflation of almost 20% every year since 2017 to date in house construction sector. Simple calculation, in 2017 if a 5 marla house was costing around 40 lacs to construct only, in June 2022 same 5 marla house with a decent A grade finish is costing around 80 lacs for construction only! land cost and its appreciations in last 5 years are not included in these figures. Similarly a 10 marla house construction which was costing around 75 lacs back in 2017, today we need a minimum of 150 lacs to construct same house.

Tables below also summarise how Increase in House construction cost in previous years has happened: