Builders hit by material price rises

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The price of most building materials, including cement, steel, bricks, paint and interior decorations, increased by 10-20 per cent this month over last month, building-material traders said.

This was not the first increase after Tet (Lunar New Year), they said, adding that in late February, the prices had risen by 20 per cent and up to 30 per cent for certain items compared to the end of last year.

The increase in transport and input costs have pushed up prices of building materials, they said.

Nguyen Van Tu, owner of a furniture shop on To Hien Thanh Street, said higher prices of imported wood materials, additives used in furniture-making, and an increase in workers' salaries had increased prices by 10-20 per cent of furniture products, including wooden doors, kitchen cupboards, wardrobes and others.

Lam Cong Tan, owner of a plywood shop on the same street, agreed with Tu saying that price of rubber wood, medium-density fiberboard and other kinds of wood also increased by 5-10 per cent this month.

A representative of a company that distributes decoration lights imported from China said prices had gone up by 15-30 per cent recently.

For example, small lamps cost between VND100,000 and VND150,000, medium lamps, VND350,000 to VND450,000 and high-end lamps, VND500,000.

She attributed the price hike to the higher exchange rate and transport costs.

Hoang Thanh Binh, director of the Viet Nam Project Co Ltd, said building material prices as well as labour costs had increased dramatically since the beginning of the year.

The main builders' salary increased to VND220,000 per day compared to VND180,000-VND200,000 per day as before, while the cost for an assistant builder currently stands at VND150,000-VND170,000 per day.

This means that building one square metre of housing floor now require up to VND3 million instead of only VND2.6 million as before, he said.

Costs for house design and decoration had also increased, which led to higher prices in construction contracts, he added.

One resident in Binh Thanh District said he had to pay an additional VND150 million ($7,166) compared to his initial construction estimate for building a three-storey house.

Steel prices are expected to fall slightly in the second quarter of the year due to oversupply and low demand, according to the Viet Nam Steel Association (VSA)

Steel consumption volume in March from VSA members fell by 30.79 per cent over the previous month, partly because steel trading companies bought less steel to stock, said VSA.

In addition, the government's slashing of public spending also contributed to pulling down steel demand, it said.