It may surprise you just how much the cost of construction materials has increased over the course of the last two years. The COVID-19 pandemic did not only bring lockdowns and wide spread infections, it also ushered in unprecedented global inflation. The cost of building a home has increased exponentially since January 2020. There are now concerns that if the cost of construction materials continues to increase at the current rate, many more Belizeans will not be able to afford building or buying a home in the near future. News Five's Paul Lopez investigates.

Paul Lopez, Reporting

It is no secret that the cost of goods and services, including food, clothing, gas prices, and labor, is at an all-time high. The same is true for the cost of construction materials.

Isani Enriquez, Professional Engineer

"I have been noticing the steady increases in prices for quite some time now, especially brought on by COVID. I have been noticing the steady increase in cost of construction materials I would say maybe late 2020 going into 2021."

Professional Engineer Isani Enriquez recently did a comparison between a price estimate he did in January 2021 for the construction of� a three-bedroom house and one he did just a few weeks ago. The difference in cost was shocking. Building a three-bedroom home, by Enriquez's estimates, costs almost fifty thousand dollars more than it did two years ago.

Isani Enriquez

"For the most part I think the highest increase has been in the cost of steel. In most instances, making the comparison between the two from that time until now, the price literally has doubled, in some case, almost tripled. So that accounts for a huge portion of it. Along with the cost of, probably every single other, the main materials in construction has definitely gone up."

So what has contributed to this hike in prices over the last two years? Well, most of it is beyond the local economy's control. Importation costs have increased by more than four hundred percent over the last two years, according to Delroy Fairweather.

Delroy Fairweather, Vice President, Custom Brokers Association

" The increase in the cost of construction material attributes to the rise in the cost of acquisition or acquiring goods coming into the country. With the rates going up three to four hundred percent that has a direct effect in the acquisition cost. So for example an item which would ordinarily cost like a hundred dollars to import you would now have to add three or four hundred dollars on top of that just to get that exact item here into Belize."

That additional expense is passed on to the consumer at the local hardware stores. If these suppliers were to keep their prices at pre-pandemic levels they would stand to lose and in some cases even go bankrupt.

Delroy Fairweather

"We import everything from a-z in construction, if you would want to say that. The only thing we would produce here is aggregate, what we call the sand and gravel. Cement has to be imported, that comes in over land by truck. Rebar which forms a part of your foundation, those are imported. The simple things as lumber that people would use for farm work, those are imported and everything that has to be imported is at a prime price."

With the devastation to homes caused by the recent passing of Hurricane Lisa, undoubtedly all this comes as bad news to home owners whose houses were destroyed. And for those home owners with house insurance, you may want to revisit your insurance premiums. According to Andrew Roe, the General Manager at RF&G Insurance, the inflated costs of construction material has a direct impact on home insurance policyholders.

Andrew Roe, General Manager, RFG Insurance

"So if you had a home, as you said, you might have built it a few years ago or you may have built it many years ago and you have been insuring it for many years gone by, before 2020, before COVID kicked in and all of this inflation started to pile up, if you had your home insured for a certain amount, let's say a hundred thousand dollars, before the pandemic, and now we have seen twenty to thirty percent inflation cost, your home has increased in value by that same inflationary amount. I am just talking about the material. I am not talking about land or anything. There is under every insurance policy across all insurance companies in Belize, something called the average clause. You may have seen commercials out there saying if you are not insuring your building for today's replacement value then you are under insuring your building."

The factors associated with building and owning a home in today's economy have compounded the fears of potential first-time homeowners. While shipping costs are expected to decrease over the next few months, Belize's import-based economy remains vulnerable to external shocks.

Isani Enriquez

"I would say, if you have the means to do it now, do it now. If you want to wait two years from now hoping the price is going down then my opinion is that is sort of like a gamble. If you want to roll the dice and take that leap then hopefully it works out in your favor. But if you have the means to do it now take the leap of faith and do it now, you know."

Channel 5