Verisk Report Shows Drop in US Reconstruction Costs in 2Q

Reconstruction cost inflation in the U.S. cooled in the second quarter, offering a bit of relief for insurers and businesses, a new report shows.

Verisk’s Q2 2026 360Value Quarterly Reconstruction Cost Analysis shows total reconstruction costs, which includes materials and retail labor, rose 3.6% year-over-year, a pace that was down from 5.2% growth in the prior year’s period. Quarter-over-quarter growth slowed to 0.8%.

Residential reconstruction costs rose 3.2% nationally. Commercial costs climbed 4.1%.

The report out Wednesday arrived as wholesale prices, a broad measure of inflation wholesale, in April posted their highest annual increase in more than three years. The producer price index rose a seasonally adjusted 1.4% for the month, higher than the 0.5% Dow Jones consensus forecast and the revised 0.7% March increase.

States that had some of the steepest increases in the Verisk report include Rhode Island, Oklahoma, Iowa, Indiana and Kansas. Georgia and Louisiana saw notable slowdowns in costs.

Skilled-trade wage growth driven by infrastructure spending, prevailing-wage requirements and limited contractor availability put upward pressure on costs. Combined hourly billable labor costs rose 3.63% year-over-year. There was a smaller, 2.95% increase ,in material costs, the report shows.

Lumber prices fell 2.3% over a 12-month period, while concrete and roofing materials also saw slight declines.