- Relief for Builders as Construction Inflation Falls for 11th Straight Month
Ghana’s building cost inflation eased further in March, extending an 11-month downward trend and offering fresh relief to households, developers and contractors after a prolonged period of elevated construction costs.
The latest Prime Building Cost Index, released by the Ghana Statistical Service, showed that building cost inflation declined to 2.2 per cent year-on-year in March 2026, down from 2.4 per cent in February and sharply lower than the 23.6 per cent recorded in March 2025. The index rose to 134.1 in March 2026 from 131.3 a year earlier, indicating that average building input prices were still higher than a year ago, but at a much slower pace.
The March outturn marks the 11th consecutive decline in year-on-year building cost inflation, underlining a sustained cooling in construction-related price pressures. However, the data also shows that costs have not fallen outright. On a month-on-month basis, building input prices increased by 0.8 per cent between February and March 2026, compared with a 0.4 per cent rise in February.
The Prime Building Cost Index measures changes in the overall cost of constructing buildings by tracking key inputs such as materials, labour and plant or equipment. The rebased index, now using 2023 as the base year, covers 406 items, grouped into three main categories and 23 subgroups, with price data collected monthly from 16 markets and 489 outlets across the country.
The moderation in building cost inflation was driven largely by easing prices in some heavyweight construction inputs. Cement recorded the lowest inflation among the sub-groups at negative 8.3 per cent, while steel inflation stood at negative 3.1 per cent. Fine aggregate, coarse aggregate and bathroom accessories also recorded negative year-on-year inflation, helping to offset increases in other building components.
Materials, which carry the largest weight in the index at 76.48 per cent, recorded year-on-year inflation of 2.3 per cent in March, marginally down from 2.4 per cent in February. But materials prices rose 1.3 per cent month-on-month, suggesting that while annual inflation has eased significantly, short-term price pressures remain active in parts of the construction supply chain.
Labour inflation also eased, falling to 1.6 per cent in March from 2.4 per cent in February. On a month-on-month basis, labour costs declined by 0.4 per cent. Skilled labour inflation stood at 2.0 per cent, while unskilled labour inflation was 1.0 per cent. Plant inflation remained unchanged year-on-year at 2.6 per cent, although plant-related prices rose 1.0 per cent month-on-month.
Yet the disinflation story remains uneven. Glazing recorded the highest year-on-year inflation at 11.9 per cent, followed closely by electrical works at 11.6 per cent. Toilet accessories, surface finishes, ironmongery, metalwork, plumbing, tiles, doors and reinforcement also recorded positive inflation, keeping pressure on selected segments of building projects.
Electrical works emerged as the largest contributor to March’s building cost inflation, accounting for 53.2 per cent of the overall year-on-year contribution. Glazing contributed 27.6 per cent, tiles 25.5 per cent, metalwork 20.3 per cent, and plumbing 11.7 per cent. By contrast, cement and steel exerted strong downward pressure, contributing negative 41.2 per cent and negative 27.3 per cent respectively.
The Ghana Statistical Service said the current environment presents an opportunity for households, businesses and government to act strategically. It advised households to consider starting or resuming building projects while material prices are stabilising and urged businesses to lock in current prices and secure medium-term contracts before any possible rebound.
For government, the agency said the low-inflation environment creates space to fast-track key infrastructure projects, including the Big Push, while targeting the main cost drivers in the sector. It also noted that persistent labour inflation points to a skills gap, making expanded artisan training an important policy priority.
For Ghana’s construction economy, the March data offers a mixed but broadly encouraging signal. The worst of the building cost inflation shock appears to have eased, improving cost visibility for developers and contractors. But the persistence of pressure in electrical works, glazing, plumbing, and other finishing-related inputs keeps the sector from being fully insulated against price volatility.
The policy challenge now is to turn the cooling inflation trend into cheaper housing delivery, faster infrastructure execution and improved project affordability. For households and developers, lower inflation may offer breathing space. For government, it presents a window to accelerate public works before construction costs begin to rise again.
