Many buyers see new construction as their only option to avoid bidding wars in today’s competitive sellers’ market.
However, building new is becoming increasingly expensive, and you may have to wait 12 months before you can move in.
Should you consider new construction in this housing market?
Why New Construction Homes Are So Expensive
While lumber prices have come down and are now only 25% above pre-pandemic levels, the general cost of materials is much higher than a year ago.
On top of it, builders must deal with a shortage of skilled workers and sharply rising labor costs. It limits their ability to build more homes and satisfy demand.
How Builders Cope with Rising Costs
I see many developers release only a few lots every month. They raise the base price by $10,000 or more a month, and they don’t promise to complete construction on a specific date.
Many builders focus on spec homes, which can be started without a buyer contract in hand.
When you sign the purchase contract the house is already under construction. You don’t have any choice on the layout and the interior design; however, you can move in within a few months.
Also, don’t expect appliances in your new home. They may no longer be included in the purchase price, because of supply chain shortages.
You Still Should Build Now – Here’s Why
Developers have underbuilt for almost 10 years. Experts believe the current housing shortage will continue for years to come. And that means new construction is getting more expensive.
The good news is that interest rates have dropped to below 3% last week, sparked by the quick spread of the Delta variant.
That’s why now is an excellent time to buy a new construction home. Lock in the price now and enjoy thousands in equity when the home is finished.
So, why should you hire me to represent you when you build new?
I have excellent relationships with builders reps. You can get access to deals that never hit the market, like the one below …
Builder Forgets Inventory Home – My Client Profits
A few weeks ago, I was searching for a new home for one of my clients. They just could not compete against cash offers thousands above list price. So, we decided to build new or buy an inventory home.
I called all my builder contacts with their specific list of requirements.
That’s how we hit gold.
The sales rep of one builder found an almost move-in ready home his company forgot to list in their inventory.
It was intended to become a model home, but somehow slipped through the cracks.
We immediately submitted an offer. My clients signed a contract for $30,000 below the current market price of an identical new built home.
Call or Text me at (614) 975-9650 for a free consultation before you talk to a builder!