Building Materials Price Changes and the Inflation Rate in Ekpoma

Abstract

This study investigated the relationship between the shifts in the inflation rate and the price of building materials in Ekpoma to aid in mitigating the adverse effects of the inflation rate on the construction industry. It examined the annual changes in building material prices due to the inflation rate, the nature of the influence of the inflation rate on the prices of building materials and determined the relationship between the inflation rate and the prices of building materials within Ekpoma. Data on the inflation rate was collated from the Central Bank of Nigeria, while prices of the building materials were obtained from a market survey. Findings revealed that the inflation rate has the highest value in 2023, while the prices of the building materials had an upward trend from 2018 to 2023. From the annual change in the variables, a 1% increase in the inflation rate will lead to the highest growth in the prices of Cement by 4.63%. Correlation analysis revealed that some building materials had no relationship with the inflation rate, while the other materials had a relationship of varying degrees with the inflation rate. Regression analysis indicated that the price of 30 tonnes of Granite would experience the highest increase of ₦15961 for every unit increase in the inflation rate. It was recommended that the government exercise its political will to address the impact of the inflation rate on building material prices. This action will promote the provision of sustainable and affordable housing solutions.