- Cement, Steel Prices Fall but Plumbing and Roofing Push Building Costs Higher
Ghana’s building cost inflation rose slightly in May 2026, signalling renewed pressure in selected construction inputs even as overall cost increases remain far below levels recorded a year earlier.
The Prime Building Cost Index recorded a year-on-year inflation rate of 2.70% in May 2026, up from 2.20% in April, according to data from the Ghana Statistical Service.
The modest increase shows that construction costs are beginning to edge up again, although the rate remains significantly lower than the 22.00% recorded in May 2025.
The PBCI tracks changes in the prices of materials, labour and equipment used in building construction. On a month-on-month basis, overall building input prices rose by 1.40% between April and May 2026.
Materials remained the main source of cost pressure in the construction sector. Material inflation rose to 3.50% year-on-year in May, compared with 2.40% in April.
This is important because materials account for more than three-quarters of the PBCI basket. As a result, even moderate increases in material prices can have a strong effect on overall construction inflation.
Labour costs, however, helped moderate the headline rate.
Labour inflation fell into negative territory at -2.00% year-on-year, down from 1.00% in April. The decline suggests that wage-related construction cost pressures eased during the period, partly offsetting increases in materials and equipment.
The plant category, which includes equipment and small tools, recorded the sharpest increase. Inflation in the category accelerated to 9.80% year-on-year in May from 4.70% in April.
On a month-on-month basis, plant-related prices increased by 4.70%, making the category the fastest-growing component of building costs during the month.
At the sub-group level, plumbing materials recorded the highest inflation rate at 22.80%. Roofing sheets followed with 19.90%, while glazing materials recorded 18.50%.
These increases suggest that selected imported and specialised construction inputs continue to face price pressures, despite the broader moderation in inflation across the economy.
By contrast, cement recorded the lowest inflation rate, falling by 14.50%, while steel prices declined by 8.10%.
The drop in cement and steel prices is significant because both inputs are critical to building construction. Their decline may offer some relief to developers, contractors and households undertaking building projects.
On one hand, overall building cost inflation remains low by recent historical standards, giving some comfort to households, businesses and government agencies planning construction projects.
On the other hand, price pressures in plumbing, roofing, glazing and equipment suggest that cost risks have not disappeared completely.
For developers and contractors, the figures point to the need for careful procurement planning.
Where prices remain favourable, particularly for cement and steel, businesses may find opportunities to lock in costs and protect margins. But for items recording double-digit inflation, project budgets may need closer monitoring.
The Ghana Statistical Service noted that despite the recent uptick, building cost inflation has eased considerably over the past year, creating a more favourable environment for households, businesses and government infrastructure projects.
The Service advised businesses to lock in current prices and encouraged government to fast-track key infrastructure projects while building cost inflation remains relatively low.
Lower building cost inflation can reduce the cost of delivering public infrastructure, including schools, hospitals, roads, housing and other capital projects. But if input prices begin rising again, delays could increase future project costs.
For private households, the moderation in building inflation offers some relief after years of elevated construction costs. Many prospective homeowners delayed projects during the period of high inflation, exchange rate pressure and rising material costs.
A sustained period of lower building inflation could improve affordability, though financing conditions and income levels will remain critical.
For the broader economy, the construction sector is a key indicator of investment activity. Lower and more predictable building costs can support real estate development, infrastructure investment and job creation.
However, the uneven movement across construction inputs shows that inflationary pressure remains sector-specific.
While cement and steel prices have fallen, sharp increases in plumbing, roofing and glazing materials may still raise costs for certain types of projects.
The challenge for contractors will be to manage these mixed cost movements without overpricing projects or absorbing unsustainable margin pressure.
The May data suggest that Ghana’s construction cost environment remains broadly improved but not risk-free.
Building inflation is no longer at the elevated levels seen in 2025, but the slight rise in May serves as a reminder that cost stability must not be taken for granted.
