Türkiye’s construction cost index rose 28.33% year-on-year in July 2026, while construction costs increased 1.15% compared with the previous month, according to data released by the Turkish Statistical Institute (TurkStat) on Wednesday.

The latest figures point to continued cost pressures across Türkiye’s construction sector, with both material and labor expenses recording significant annual increases.

According to TurkStat, the material index increased by 1.28% month-on-month in July, while the labor index rose 0.92%.

Compared with July 2025, the material index increased 27.13%, while the labor index climbed by a significantly higher 30.51%.

The figures indicate that rising labor costs continued to place substantial pressure on construction companies, while material prices also remained elevated.

The increase was slightly higher in the building construction segment.

TurkStat reported that the building construction cost index increased 28.37% year-on-year in July, while rising 1.08% from the previous month.

Within the building construction sector, the material index increased 1.21% month-on-month, while the labor index rose 0.86%.

On an annual basis, building material costs increased 27.34%, while labor costs rose 30.19%.

The data show that labor expenses continued to increase at a faster pace than material costs, adding to the financial burden faced by contractors and developers.

Construction costs in civil engineering also recorded a substantial annual increase.

The civil engineering construction cost index rose 28.19% year-on-year in July, while increasing 1.38% compared with June, according to TurkStat.

Material costs in civil engineering increased 1.49% month-on-month, while labor costs rose 1.15%.

On an annual basis, the material index increased 26.50%, whereas the labor index surged 31.65%.

Labor costs therefore recorded the strongest annual increase among the major components of civil engineering construction costs.

The latest figures highlight the continued cost pressures facing Türkiye’s construction industry.

Although the monthly increases remained relatively moderate, annual construction costs continued to rise at rates above 28%, driven by elevated material and labor expenses.

The sustained increase in construction costs could have implications for housing prices, infrastructure projects and the overall pace of investment in the sector, particularly if contractors continue to face higher input and workforce expenses.

The July data also show that labor costs are rising faster than material costs across both building construction and civil engineering, underlining the growing importance of wage-related expenses in the sector.

With construction playing a significant role in Türkiye’s economy, developments in construction costs remain closely watched by businesses, investors, policymakers and households. (ILKHA)