Input costs set to make buildings costlier amid strong fundamentals: JLL

India’s construction industry is likely to see a 3–5 per cent rise in costs across asset classes in 2026 amid rise in labour costs and higher metal prices, a report said.

Developers who embrace workforce formalisation, leverage GST savings strategically, and invest in technology adoption will emerge as leaders in this dynamic landscape, the report noted.

The report from real estate services firm JLL said material costs showed mixed trend in 2025 as cement, steel and diesel dropped by about 1–2 per cent, 3–4 per cent and 5–6 per cent respectively, while aluminium and copper jumped 8–9 per cent and 9–10 per cent on global demand and supply chain dynamics.

Labour costs are experiencing the most consistent upward pressure, increasing by 5-6 per cent across all categories, driven by skilled labour shortages and infrastructure demand, it added.

"India’s construction industry is experiencing a significant transformation, driven by strong economic fundamentals, evolving market dynamics, and transformative regulatory reforms," the report said.