International Journal of Managerial Studies and Research (IJMSR) Volume 2, Issue 10, November 2014, PP 116-133 ISSN 2349-0330 (Print) & ISSN 2349-0349 (Online) www.arcjournals.org ©ARC Page 116 Determination of a Price Index for Escalation of Building Material Cost in Nigeria Olagunju, Mukaila (Ph.D) Department of Computer Science, Institute of Information and Communication Technology (IICT), Kwara State Polytechnic, Ilorin, Nigeria olamukiala@yahoo.com Owolabi, K.M Department of Building Technology, Institute of Environment Studies (IES), Kwara State Polytechnic, Ilorin, Nigeria m.k_owolabi@yahoo.com Afolayan, A.O Department of Estate Management, Institute of Environment Studies (IES), Kwara State Polytechnic, Ilorin, Nigeria niyi.afolayan@yahoo.com Abstract: The major problem facing the building industries is changing in prices of different items such as cement, block, house rent, etc. The main objective of this study is to develop statistical analysis to measure the price index of house rents in different location in Ilorin metropolis and compare these house rents with the price building materials such as cement and block for a period of time. Profit index analysis was used to measure the change in price and compare it with price of building materials. With this analysis Both the Government and stakeholders will be able to plan ahead, in other to find the solution to the problem of building scarcity. Keywords: Price Index, Escalation, Correlation, Regression Analysis. 1. CONTRIBUTION Price index of items determines the values of such items; some items have their value increase over the period of time. Time items that belong to such categories include landed properties such as buildings, pieces of land, and other related items. In this study we try to take into consideration the price index of items that their price and values keeps on increasing over the period of time. Comparison of prices of some of the items that are normally used in building construction is analyzed to determine the price change over some period of a time. 2. INTRODUCTION Nigeria is one of the developing countries in the world, this challenges causes scarcity of houses in Nigeria in which the working classes are mostly affected. This major problem affects mostly averages Nigerian such as scarcity of houses, Education, transportation and many others. The main reason is that price of items such as cements, blocks, houses rent keep on changing in geometric progression while the rate of income are increasing in arithmetic progression. With the problems mentioned above, it‟s very difficult or impossible for the working class to have their own houses. This paper tries to focus on the price index analyses of some items that are used in building industries. We try to compare the price changes over time. The main objective are; 1. To bring to the awareness of the government the change in price of the building items 2. To bring to the awareness of the people of Nigeria in price change