Rising Construction Costs: What Roofers Need to Know and How to Stay Ahead

If you’ve been in the roofing game long enough, you know that material and labor costs are always moving targets. But lately, they’re moving in one direction—up. The latest Q3 2024 Reconstruction Cost Analysis from Verisk lays out some hard-hitting stats that every roofer should be paying attention to.

Between July 2023 and July 2024, total reconstruction costs in the U.S. jumped 5.2%—a sharp increase compared to previous years. If you’re feeling the squeeze on your margins, you’re not alone. Let’s break down what’s happening, why it matters to your business, and how you can stay ahead.

The Big Picture: Costs Are Climbing

The Verisk report shows that residential reconstruction costs are up 4.9%, while commercial reconstruction costs climbed 5.5% year-over-year. And if you’re working in states like New Hampshire (+9.59%), Colorado (+9.05%), or Nebraska (+6.37%), you’re seeing even bigger hikes.

And here’s a kicker—certain areas hit by storms are seeing cost spikes well beyond the national average. Take Texas, for example: in Dallas/Fort Worth, roof replacement costs jumped 7.5%, and in Sherman, TX, costs skyrocketed 9.7% after severe wind and hailstorms in May.

Why? Labor costs. When storm season hits, there aren’t enough roofers to go around, and demand drives wages up. The report confirms that roofing labor rates have been steadily rising, making it more expensive to get jobs done.

Material Costs: The Good, the Bad, and the Ugly

Material prices aren’t as volatile as they were during the pandemic, but they’re still on the rise. The report highlights:

• Concrete composite: Up 13.9% (ouch)
• Lumber: Up 2.12% (better than last year’s drop, but still creeping up)
• Roofing materials overall: Up 2.1%
• Metal roofing: Up only 1.5% (a rare bit of good news)

While these increases seem modest compared to past years, they add up. A 2.1% bump in roofing materials might not sound huge, but when you’re ordering thousands of dollars in shingles, underlayment, and flashing, every percentage point eats into your profits.

What This Means for Roofers

So, what’s the takeaway? If you’re a roofing contractor, rising costs impact everything from job pricing to insurance claims and supplements.

1️⃣ Your Estimates Need to Be Tight

If you’re still using old pricing data, you’re losing money. With material and labor costs fluctuating, keeping your estimates up to date and accurate is more critical than ever.

2️⃣ Insurance Claims Are More Complicated

Most insurance adjusters don’t track these cost increases in real time. That means their initial estimates are often way too low. If you’re not submitting supplements, you’re leaving money on the table. (At Estimate on Demand, this is exactly what we help roofers with.)

3️⃣ Storm Damage Work Is Getting More Expensive

If you work storm restoration, expect price hikes—especially in hard-hit regions like Texas. The labor crunch is real, and insurance carriers aren’t adjusting their estimates fast enough.

How to Stay Ahead of the Curve

✅ Keep an eye on pricing trends. Follow reports like Verisk’s and track material costs from your suppliers. Staying informed keeps you from underbidding jobs.

✅ Master your supplement game. Adjusters miss things. A lot of things. Submitting well-documented supplements ensures you get paid what you’re owed.

✅ Lock in supplier pricing when you can. If you have a chance to bulk buy materials at today’s prices, do it—especially if you’re seeing steady work ahead.

✅ Invest in efficiency. Rising labor costs mean every wasted hour is more expensive. Optimize your workflows and crew management to get jobs done faster.

The Bottom Line

Roofing isn’t getting any cheaper, but smart contractors can still thrive by staying informed, pricing jobs correctly, and maximizing their insurance claims. If you’re not paying attention to rising costs, you’re already losing money.

At Estimate on Demand, we help roofers navigate these challenges by providing accurate, AI-driven supplements and insurance estimates. If you’re dealing with adjusters who are lowballing claims, let’s talk—we’ll make sure you get paid what you deserve.

💬 What’s your experience with rising costs? Have you seen these price jumps in your area? Drop a comment and let’s talk about it.