Rising lumber costs mean homebuyers will have to start paying more.
Lumber costs have caused new homebuilders to raise their prices dramatically. The average cost of lumber has increased construction costs by about $35,000 compared to last year.
As a homebuyer, this means you’ll pay more for a home now than you would’ve six or 12 months ago. This trend will only continue as the cost of lumber rises, along with the cost of labor, gas, etc. This is what’s known as inflation. The good news is that interest rates are still hovering around 3%, so it’s still a good time to buy.
One of the challenges of buying a new home today is the fact that most new home subdivisions don’t have enough inventory to keep up with buyer demand. Thus, many of these subdivisions have waiting lists and auction sales. One of the many reasons you need a Realtor on your side for this type of purchase is that we have the inside track with many salespeople. Just the other day, a builder called me saying he has 15 new homes coming on the market that don’t have buyers. I immediately started going through my database, and now I have two buyers who have brand-new homes.
Some builders are also offering to give back buyers’ down payments due to construction delays. This sounds great, but what they’re really doing is trying to get people to back out so they can resell those homes for $45,000 to $60,000 more than they did a few months ago. This is all the more reason to hire a good Realtor to represent your best interest when buying a new home.
If you have questions about this or any real estate topic, don’t hesitate to reach out to me. I’d love to help you.