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Construction Costs in Dubai Decreased by 0.37% in 2015

​​Image shows group of buildings in Dubai

​​Image shows group of buildings in Dubai

​The general index of construction cost decreased to 100.60 in 2015, which is 0.37% less than 2014 general index of 100.97, due to the decrease in the general index of the raw materials from 99.62 in 2014 to 98.73 in 2015, as a result of the decrease in the price of most building materials.

A DSC report showed that the prices of most building materials decreased by 0.89%, while the general index of equipment, labor and other costs increased from 103.00 in 2014 to 103.41 in 2015, with an increase of 0.40%.

As regards the index of construction costs for 2015, the prices of raw materials used in construction in 2015 slightly decreased by 0.89%, due to the decrease in the prices of manufacture by 1.00%, while quarry prices increased by 1.54%. Also, the prices of raw materials used in non-residential buildings decreased by 1.12% and 0.84% in residential buildings.

Raw Materials

As regards the index of raw materials, DSC report indicated that the prices of quarries increased by 1.54% due to the increase in the price of raw stones, sand and gravel by 1.54%. It is worthy to note that the price of these materials increased by 1.54% in both residential and non-residential buildings.

The report showed that the fluctuation in the prices of manufacture materials between increasing and decreasing contributed to limiting the decrease of the index for this category by 1.00%. The decrease occurred in the prices of raw materials among others, as the prices of refined oil products decreased by 32.50% and prices of the basic metal products such as construction steel and aluminum products decreased by 11.27%. Also, the prices of electrical appliances – including electricity distribution devices and wires decreased by 1.55%, the prices of chemicals and chemical products by 1.24%, timber and its products, other than furniture, by 1.16% and the prices of other equipment and devices like water faucets and valves by 0.92%.

Meanwhile, the prices of other items increased, as the prices of furniture increased by 11.00%, molded metal products such as reservoirs and tanks by 4.82%, the prices of rubber and plastic products by 0.35% and the prices of computers, electronic and visual devices by 0.30%.

Moreover, the prices of the other non-metal products, including basic products such as cement and cement products increased by 0.18%.

When studying the movement of the index on the level of buildings, it was noticed that the non-residential building price index decreased by 1.22% and the residential by 0.94%.

Manufacture:

As regards the expenses of the manufacture category, it was noticed that the prices of timber and timber products other than furniture decreased by 1.16%, due to the increase in the prices of sawed or flattened timber by 2.66%. Also, the prices of wooden products such as wooden sheets, compressed wooden panels, fine-grained wood and MDF decreased by 1.61%. The change in price was 1.17% for non-residential buildings and 1.16% for residential buildings.

Refined products

DSC report pointed out that the decrease in the prices of refined oil products, such as the prices of engine fuels and liquid fuels affected the decrease in the index of this category by 32.50%, due to the decrease in diesel prices by 32.50%. The rate of change was similar for all types of buildings at 32.50%.

Chemical Products

The price index for chemicals and chemical products category decreased by 1.24% due to the decrease in the prices of all the products belonging to this category, as materials included under paints, varnishes and shades decreased by 1.24%. Prices decreased by 1.25% for non-residential buildings and 1.24% for residential buildings.

Rubber and Plastics

The price index of the rubber and plastic products increased by 0.35% due to increase in the price of plastic, such as plastic tubes, hoses and their connections by 0.40%. The prices of other rubber products remained the same. The prices of rubber and plastic increased by 0.37% in non-residential buildings and 0.34% in residential buildings.

Non-metallic Minerals

The price index of other non-metallic minerals increased by 0.18% due to the increase of products made of concrete, cement and plaster, such as blocks, bricks, cement tiles and readymade concrete and gypsum products by 1.44%. The prices of glass and glass products increased by 0.69%, while the prices of cement, lime, gypsum, increased by 0.12% and the prices of other non-metallic minerals such as asphalt and insulation materials increased by 0.10%. The prices of ceramic structural clay products, such as ceramics, red bricks and tiles by 1.98%. Also, the prices of stones, ready or molded marble and alabaster decreased by 0.48%. The report revealed that these prices increased by 0.28% for residential buildings and decreased by 0.17% for non-residential buildings.

Basic Metals

The prices of materials under this category decreased by 11.27% due to the decrease in the basic iron and steel price by 11.88%, the decrease in the prices of basic precious metals and other non-ferrous metals, such as copper/lead wires and tubes significantly by 9.37%. The prices of these materials decreased by 11.29% for residential buildings and decreased by 11.19% for non-residential buildings.

On studying the index movement according to the type of buildings, it was found that the prices of these materials increased by 4.90% for residential buildings and 4.19% for non-residential buildings.

Electronic Products

The price index of computers, electronic and visual products increased by 0.30% due to the rise in the prices of communication equipment such as transmission and receiving equipment (transmission/receiving antennas) by 2.69%, the prices of measuring, verification, testing, navigation and control devices, such as automatic controllers, electricity, gas and water meters and others by 0.94%, despite the decline of consumer electronic products such as electronic visual equipment (visual recorders, electronic audio devices such as recorders accessories) by 0.73%. Upon studying the index according to type of buildings, it was found that the prices increased by 0.32% for residential buildings and 0.24% for non-residential buildings.

The price index of electrical appliances decreased by 1.55%, due to the decline in the prices of engines, generators, transformers, electricity distribution and control devices by 7.19% and the decrease of the prices of other electronic wires and cables, such as insulated, steel, copper or aluminum electric wires and cables by 3.00% and the prices of electric lighting devices by 0.64%, while the prices of home appliances such as fans, hoods, electric heaters increased by 0.82% and the prices of electric wiring equipment, such as electric power cutting/connecting devices and electric switches increased by 0.35%.

The price index of equipment and other devices category decreased by 0.92% due to the decrease in the prices of the other multi-function equipment, such as air conditions, hoods, air filters, liquid and gas filters and fire extinguishers by 1.69%, while the prices of pumps, presses, faucets and other valves decreased by 0.46%.

Equipment

As regards the cost of equipment, manpower and other expenses, DSC report showed an increase in the price index by 0.40% due to the increase in labor wages and other expenses by 0.50%, in spite of the decrease in the expenses of renting equipment by 1.39%.

The index increased by 0.40% in both residential and non-residential buildings.

The general index of construction cost till the third quarter of 2015 has increased to 100.87, representing a slight increase of 0.05%, compared to the general index till the third quarter of 2014, which was 100.82.

This came as the result of the increase in the general index of equipment, workforce costs as well as other costs from 102.85 till the third quarter of 2014 to 103.46 till the third quarter of 2015, where it recorded an increase of 0.60%.

Also, the general index of raw materials decreased from 99.46 till the third quarter of 2014 to 99.14 till the third quarter of 2015, due to the decrease in the prices of most of the materials used in construction, as it recorded a decrease of 0. 32%.

The prices of raw materials used in construction till the third quarter of 2015 decreased slightly by 0. 32%, due to the decrease in the price of manufacturing materials by 0.41%, while the prices of quarries increased by 1.75

Quarry Materials

The prices of quarry materials increased by 1.75%, due to the increase in the prices of raw rocks, sand and gravel by 1.75%. It is worth noting that the prices of these materials increased by 1.75% in residential buildings and 1.74% in non-residential buildings.

Manufacture

The fluctuation in the prices of manufacturing materials and its ups and downs led to stopping the index from decreasing by 0. 41% for this category. The price increase in the categorized items came as follows:

  • The prices of furniture increased by 12.08%,  the prices of shaped metal products such as reservoirs and tanks by 5.62%, the price of other non-metallic minerals that include important basic materials such as cement and cement products by 0.87%, the prices of rubber and plastics by 0.40% and the price of computers, electronic and visual devices by 0.11%, while the prices of the following categorized items decreased:
  • The prices of refined oil products drastically decreased by 26.85%, the prices of principal metal products, such as the reinforcing steel and aluminum products decreased by 9.04%, and also the prices of electrical appliances, including electricity distribution devices and wires decreased by 1.61%. The prices of timber and its products other than furniture decreased by 1.33%. The prices of chemicals and chemical products decreased by 1.05%. The prices of other equipment and tools such as water taps and water valves decreased by 0.79%.

When studying the index as regards buildings, it was noticed that the index for non-residential buildings decreased by 0.61% and for residential buildings by 0.36%.

Timber and its products other than furniture

The prices of raw materials under this category decreased by 1.33%, due to the decrease in the price of sawed or flattened timber by 1.93%. Also, the prices of wooden products such as wooden sheets, compressed wooden panels, fine-grained wood and MDF by 1.81%. The change in price was at the equal rate of 1.33% for both residential and non-residential buildings.

The decrease in the prices of refined oil products, represented in the prices of engine fuels and liquid fuels impacted the decrease of this category's index by 26.85% due to the decrease in diesel prices by 26.85%. It is worth noting that the rate of change was similar for all types of buildings at 26.85%.

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