As the U.S. housing industry recovers from its worst downturn since the 1930s, builders are having to cope with steep cost increases for various materials as well as rising land prices and shortages of skilled labor.

Trends:
– skilled labor shortfall: builders left certain areas for better prospects elsewhere
– cheap labor shortfall: more strict immigration laws

– material costs increase significantly
– higher new home construction costs may steer buyers in direction of existing, previously owned homes – a healthy sign to reach a more ‘normal’ market

Link to article By Shobhana Chandra and John Gittelsohn, May 02, 2013 BBW

Source: Bloomberg Business Week, May 2, 2013