Some local markets are seeing a sharp rebound in building activity. But there's a hitch: Materials prices are rising as fast as house prices.

In Myrtle Beach, South Carolina, builders say subcontractors are struggling to keep up with the rush of work — but materials costs are an even bigger worry, according to a report in the Sun News ("Material costs could be the pin that busts recent building increase," by Steve Jones). "Homebuilder Ed Friend said that a standard sheet of plywood has gone from $6 to $13 in the last six months, drywall has gone up twice in the same time and overall, the price of lumber is up by 39 percent," the paper reports. "Concrete is looking at its fourth price increase in the coming months, and the cost of steel has joined the upward march of other materials."

In coastal New Jersey, hard hit by Hurricane Sandy, materials price increases are creating sticker shock for builders working on rebuilding projects, reports the Press of Atlantic City ("Recession, Hurricane Sandy, keep cost of building materials high," by Michael Miller). "Michael Kurpiel has been keeping up on construction prices as chairman of the Building Materials Task Force for the New Jersey Builders Association," the paper reports. "Kurpiel said prices have increased at least 15 percent for roofing and siding in the past year, with another 15 percent increase projected for 2013. Drywall prices are up more than 30 percent. And lumber is up between 30 percent and 40 percent over 2012."