Call Us: (952) 935-9469

Request a Quote Facebook Twitter Google+

Roofing prices are on the rise in Minneapolis

The primary challenge in working with insurance companies in terms of the replacement of roofs damaged by the August 6th hail storm isn’t so much in defining an accurate scope for the work but in getting paid fairly for that work. Insurance companies have an immense apparatus in place to depress pricing. It’s based on a proprietary software system called Xactimate and is one of the most effective tools insurance adjusters use to underpay claims. The fact is that right now a medium hand-split cedar shake roof costs $750 to $850 per square to install, including labor and materials. Variables such as roof complexity, steepness and height can push those numbers by 20% higher. Companies like American Family, Farmers and Allstate are offering $505 to $523 per square. We battle with these companies daily in trying to get them to understand the cost of cedar shake roofing. It’s often a fruitless effort because they simply refuse to pay market rate for this type of work. Just today I was told by an American Family adjuster that we should be able to buy shakes for $164 per square. I asked her if she would please share her source for such affordable product but she wouldn’t.

Here is a link to a current price list from one of our main suppliers in town. In fact, these guys sell wood to just about everyone and their numbers are as good as they get:  Cedar roof wood roof material prices Minneapolis. We purchase a ton of wood. We are paying $200 per square for the cedar alone, some 18% higher than the aforementioned insurance companies want to pay. In the past six weeks we have seen the price of both labor and materials for cedar shake and shingle roofing increase by about 10% with an anticipated increase of an additional 10-15% by the spring of 2014.

While the price of materials is totally out of our control I’ve been asked a few times about why labor is increasing. After all, as the boss I’m the guy who controls what I pay my people, right? Yes and no. Here is what’s currently happening to my labor prices. Since the August 6th hail storm other companies have tried repeatedly to poach my guys out from under me by offering significantly higher wages. They literally walk onto our job sites and attempt to steal my guys! Ultimately I understand that this is just what happens when demand for skilled labor far exceeds the supply. The result is that my men are forced to ask me for a raise in order to stay put. I can’t blame my guys. We all have families to feed and we all need to do our best to earn a living. It’s basic economics. The net result is that the cost of qualified, experienced labor is skyrocketing here in the Twin Cities. The labor grab is happening across Minnesota as companies struggle to find qualified installers to get the work done. Excessive demand applied to limited supply equals increased prices. Econ 101. I think we need to send some insurance company storm adjusters to a class in basic economics.

 


Copyright © 2012 - 2019, Kuhl's Contracting. All Rights Reserved

(RSS)