Prices rose 0.9% in Q1 2011 compared to the previous quarter according to the latest UK construction Tender Price Index compiled by The Building Cost Information Service.

Tender prices have been on a general upward trend since Q2 2010 and experts expect that to continue for at least two years despite predicted falls in new work.

Materials costs rose 7.6% over the past year  and it is anticipated that materials prices will continue to rise in 2011 following sharp increases in the price of crushed rock, precast concrete, paint, asphalt, lead, copper,  steel reinforcement and fabricated steelwork.

Some materials prices have decreased including sand, gravel, clay bricks, imported sawn and planed wood.

Peter Rumble, Information Services Manager at BCIS said: “Tender prices are expected to rise by around three per cent per annum over the next two years, primarily as a result of cost push factors.

“With new work output expected to fall in 2011 and 2012, it is anticipated that the level of new work output will be around eight per cent below the pre-recession level of 2007 in 2012, but eight per cent above the low point of the recession in 2009.”