While 2004 was a strong year for the construction industry as a whole, contractors were faced with dramatic price increases on certain materials. Good news — in the form of projected price decreases — was announced by experts at the NAHB Construction Forecast Conference held in October. However, bad news accompanied it: Prices for many common materials will still be significantly higher in 2005 than they were in 2003.

John Mothersole, principal of Global Insight, was one of the experts who presented projections at the conference. Here's what he says about the future of some of the most integral — and recently most volatile — products.

Lumber. Softwood framing lumber prices are up about 18% over a year ago, in part due to an ongoing dispute between the United States and Canada over duties on Canadian softwood lumber. Mothersole is projecting only a roughly 8% decrease by this time next year, and that the slow decline will continue into 2006.

Wallboard. Prices are currently up about 18% over the fourth quarter of 2003, and contractors can expect to see a 6% decrease over the coming year.

Cement. This is one material whose prices Mother-sole predicts will go up. He approximates a 3% cost increase from now until the end of 2005. —H.A.