Building construction cost data in Nigeria�

Cost of Building Materials Building materials had been playing an important role in the construction industry. They were all naturally occurring in the ancient times, for example, stone, wood, straws, clay, lime, and brick (Akanni, 2006; Taylor, 2013). As the building techniques were improving, simple composite materials, combined by means of mixing and/or heat treatment, were developed. A typical example is concrete, which was developed by the Roman Empire (Everett & Barritt, 1994). Due to advances in science and technology at the beginning of the 20th century, materials with better performance and durability were introduced, for example, reinforced concrete, steel, plastics, and metal (Taylor, 2013). Ibn-Homaid and the report of UNCHS found that building materials remain the most significant input in project development and play a very important role in the delivery of construction projects. Buttressing this view, Jagboro and Owoeye and Idoro and Jolaiya find that building materials alone account for 50% to 60% of project cost and control about 80% of its schedule. One of the major constraints in the Nigerian construction industry today has been the rapid inflation in the cost of the building materials. Windapo, Ogunsanmi, and Iyagba observed that the situations arising from the rapid increase in the cost of building materials may degenerate to acute shortages of housing with the millions of middle- and low-income families being priced out of the market for home ownership all across Nigeria. According to Mansfield, Ugwu, and Doran and Obadan , government policies set the economic environment in which all sectors operate including the building materials sector. Dlakwa and Culpin and Adekoya identified government fiscal policies as one of the factors affecting the cost of building materials in the Nigerian construction industry. However, findings of other researchers, Jagboro and Owoeye ; Mojekwu, Idowu, and Sode ; and Idoro and Jolaiya , concluded that factors such as the change in government policies and legislations, scarcity of building raw materials, fluctuation in the cost of fuel and power supply, inadequate infrastructural facilities, corruption, fluctuation in the cost of plant and labor, seasonal changes, fluctuation in the cost of transportation and distribution, political interference, local taxes and charges, fluctuation on cost of raw materials, fluctuation in the interest rates and the cost of finance, the inflation, and fluctuation in the exchange rate of Naira were many of the recipes for the rising cost of building materials in Nigeria. Implications of Rising in the Cost of Building Materials The general direction at which prices of building materials are increasing in Nigeria was as the result of the combined effects of high interest rates, devaluation of the Naira, inflation, and non-effective distribution network of the materials (Ogu & Ogbuozobe, 2001; Oladipo & Oni, 2012). According to Mojekwu et al. , the Nigerian Government curtailed activities in cement business when it banned the importation of Portland cement in the country between 2003 and 2007. The study also found that although the restraining of the importations was done to protect local manufacturer but then the local manufacturer were not able to produce enough cement that could measure to the demand and as such, the action contributed to the rising cost of the product. However, Jagboro and Owoeye and Aibinu and Jagboro noticed that increase in the prices of building materials has multiplier effects on the industry as it leads to fluctuation in construction costs and the eventual abandonment of projects.

Other implications such as completion at the expense of other projects, delay in progress of project works, other valuable projects not being commissioned, rate of employment of construction workers, poor workmanship as a result of the use of low-quality local materials, and inhibited innovations in construction methods were identified by Elinwa and Buba ; Idoro and Jolaiya ; Okpala and Aniekwu ; Oladipo and Oni ; and Windapo et al. as the possible implications of the rising cost. The report was of the opinion that increasing financial pressure are bound to be on contractors when initial budget figures become completely unrealistic and concluded that the situation will damage the industry and jeopardize its existence Xiao and Proverbs also argued that construction companies have a social responsibility to provide staff training, maintain a high level of health and safety of its workers, and invest in research and development to facilitate continuous improvement in technology and management. However, inflation in the cost of building materials had resulted in low and unreliable rate of profitability, and this has affected the performance of the industry in the area of innovations in construction methods and material research. Fluctuation in construction costs Maintaining steady cost projection on construction projects had been an issue of serious concern both to the client and project contractors. Azhar, Farooqui, and Ahmed noticed that the basic reason of cost overruns is that most contractors quote prices based on their projected estimates; unfortunately, the prices change so quickly that the initial budget figures become completely unrealistic. On the Nigerian scene, Jagboro and Owoeye found that one of the most serious problems in the Nigeria construction industry is the project cost overrun, with attendant consequences of completing projects at sums higher than the initial sum and concluded that project abandonment ensues in most cases. Quality of workmanship is affected According to Lam, Chan, Wong, and Wong , one of the hallmarks of a developed construction industry is in the output of quality buildings and structures. The quality of workmanship in construction work is assessed according to the requirement of the relevant standard, and marks are awarded if the workmanship complies with the standard (Construction Industry Development Board, 2011). The study of Oladipo and Oni , which reported the trend in the cost of building materials, has envisaged great danger for the construction industry and the nation’s economy in that there were instances of conflicts between building contractors and their clients over upward review in contract sums, and in an attempt to avert such conflicts and remain in the business, some contractors resorted to the use of substandard or insufficient materials for construction projects, which had contributed to cases of building collapse in the nation. Their studies also affirmed that the situation may have a multiplier effect on the industry and may lead to fluctuation in the construction cost. Volume of construction output is affected According to Fagbenle, Adeyemi, and Adesanya , the output of the construction industry in Nigeria is quite low when compared with construction industry of many developed countries. Congruent to this assertion, Windapo et al. observed that situations arising from the rapid increase in the cost of building materials may degenerate to acute shortages of housing with millions of middle- and low-income families being priced out of the market for home ownership all across Nigeria. The observations from these studies were due to the high cost of building materials according to Anosike who found that Nigeria has more than 17 million housing deficit as of 2004. Rate of employment is affected The construction industry’s workforce is extremely diverse and includes different types of individuals working within construction such as unskilled workers, skilled workers, craft, managerial roles, and administrative workers. According to research, maintaining and attracting the right people within the construction industry is a priority due to the scarcity of both skilled people and experienced managers. Ayodele and Alabi found that inflation in the costs of building material is killing the construction industry as many contractors are unable to forecast accurately the expected profit on the project, and the situation had contributed to laying-off of the workers and closure of firms in some extreme cases.