Building cost inflation rises to 3.1% in June

Ghana’s building cost inflation increased marginally to 3.1% in June 2026 from 2.7% in May, driven largely by higher costs of construction materials and plant, the latest Prime Building Cost Index (PBCI) released by the Ghana Statistical Service (GSS) has revealed.

The increase in the year-on-year rate, however, came alongside a moderation in monthly cost pressures. On a month-on-month basis, building costs declined by 0.1% in June, compared with a 1.4% increase recorded in May.

The PBCI tracks changes in the prices of major inputs used in the construction sector, including materials, labour and equipment. Using 2023 as the base year, the index provides a key reference point for developers, contractors, investors and policymakers in assessing cost trends and making pricing and investment decisions.

Although building inflation edged up in June, the latest figure represents a significant slowdown compared with the 18.1% recorded in June 2025, reflecting a substantial easing of construction cost pressures over the past year.

The index has remained relatively stable since February 2026, fluctuating between 2.2% and 2.7% before the slight increase recorded in June.

“Building inflation has slowed sharply, from 18.1% in June 2025 to 3.1% in June 2026,” Government Statistician Dr. Alhassan Iddrisu said.

“Although it rose slightly from 2.7% in May, building costs are increasing far more slowly than a year ago, supporting better planning and investment.”

Construction materials continued to account for the largest share of building cost increases during the period, with materials inflation rising from 3.5% in May to 3.9% in June. The GSS indicated that materials contributed 96% of the overall building inflation rate.

Plant costs also recorded a notable increase, with inflation in the category rising from 9.8% in May to 16.0% in June. Meanwhile, labour costs continued to decline, with labour inflation falling further from -2.0% to -2.6%.

“Building inflation in June 2026 was driven mainly by construction materials,” Dr. Iddrisu said.

“Plant inflation accelerated sharply to 16.0%, while labour inflation declined further to -2.6%, helping to moderate overall building cost pressures.”

Among the 23 construction sub-groups monitored under the index, plumbing recorded the highest year-on-year inflation rate at 23.9%, followed by roofing sheets at 21.4% and small tools at 19.7%.

On the other hand, cement recorded the lowest inflation rate at -13.0%, while steel prices declined by 8.6%, helping to reduce overall pressure on construction costs.

Electrical works emerged as the largest contributor to the increase in building costs, followed by metalwork, glazing, plumbing and tiles. The GSS noted that declines in cement and steel prices served as key factors limiting the overall rise in construction expenses.

The Service added that 14 out of the 23 sub-groups recorded inflation rates above the national average of 3.1%, highlighting continued variations in cost movements across different areas of construction activity.

Dr. Iddrisu said the relatively stable inflation environment provides an opportunity for government, businesses and households to plan construction projects with greater confidence.

“The June figures present an opportunity for action,” he said.

“Government can accelerate priority infrastructure projects while inflation remains relatively low. Businesses should strengthen procurement planning and secure competitive contracts. Households can plan construction more confidently while keeping a close watch on changing material prices.”