Smaller Builders Are Feeling Material Costs More

Material costs are up across the board, but not evenly. According to survey data behind the July 2026 NAHB/Wells Fargo Housing Market Index, building material costs rose a median of 6.7% over the past year — and smaller builders are feeling it more than larger ones.

The pattern: builders who started five or fewer homes in 2025 saw a median cost increase of 9.1%, while builders with 100 or more starts saw only 1.8%. Larger builders typically have more room to stockpile materials ahead of anticipated price increases, longer-term supplier contracts that lock in pricing, and closer supplier relationships that can defer increases altogether — advantages that smaller, regional builders and contractors don't always have access to.

It's a good reminder for anyone budgeting a project this year: material cost estimates that felt safe a few months ago may need a second look, particularly on jobs with a longer runway between bid and build.