Think Twice Before Building A House
Everyone has a different image in their mind when they think of their dream home. Some people imagine sprawling ranch-style homes with cozy rooms. Others think of sleek and angular spaces that will go perfect with mid modern furnishings. For many, they have spent years thinking about all of the little details that they would want in order to feel as if their home is perfect. However, home buyers rarely have the opportunity to buy a house that perfectly matches the ideal that they had built in their head. If you are buying an existing home, chances are that you will have to compromise in various ways. Most home buyers accept this. However, there are some who refuse to compromise. Oftentimes, these individuals think it would be best to build a home rather than buying an existing home. While this seems nice, you should really think twice before building a house.
The Difficulties of Building a New House
Building a house might seem like the perfect way to get exactly what you want in a new home. However, building a new house in today’s market is much more difficult than you would imagine. More importantly, it is often a lot more expensive than you would think. There are critical supply shortages that are posing serious challenges to homebuilders all over the United States.
Supply Shortages Hurts Home Builders
One shortage that is currently causing headaches for many different industries, but especially home builders, is an aluminum shortage. The supply of aluminum in the world is under stress and, unfortunately, it does not appear to be short term. Critical shortages of aluminum could potentially last for several years. The root cause of the aluminum supply shortage rests mainly in China. China is the world’s largest supplier of aluminum and industries here in the United States rely on their exports. Unfortunately, aluminum production in China has seen a few major disruptions. First, the pandemic hit this industry fairly hard. Months of lockdowns caused producers to fall behind. Second, China is taking major steps to curb carbon emissions as part of their efforts to reduce climate change. Aluminum production emits a lot of carbon, so China is scaling back its production.
Aluminium supply shortages are a big problem for anyone who is trying to build their own house. Home builders use aluminum for everything from framing to gutters. The lack of aluminum is causing homes to be built at a slower pace and is also increasing their price. The cost to build a home comes down to the cost of the components plus labor. While supplies of aluminium are limited, the demand for it is quite large. First, home builders are rushing to complete new projects in order to take advantage of the red hot real estate market. Second, many around the country are trying to rebuild their homes after natural disasters, such as Hurricane Ida or wildfires out west. The massive demand for aluminum is causing the price to skyrocket, which ends up getting passed onto anyone building their own house.
Alluminium is not the only material that has proven problematic for home builders. The industry has also faced critical shortages of lumber. Over the past year, new home projects have ground to a halt as builders could not secure the lumber needed. For those who could find lumber, they saw the cost of these projects rise dramatically.
The global supply chain has been greatly disrupted over the past 18 months and there is no telling how long it will take to get back on track. As long as these disruptions exist, anyone who is considering building a home should take a long pause. You need to know that there is a good chance that building a home will take longer than you would like and will cost more than you expect.
Home Builders are Facing a Labor Shortage
Home builders are facing more problems than supply shortages. They are also facing a shortage of skilled labor. Building a house is not as simple as putting together a desk from Ikea. It takes incredibly talented and knowledgeable individuals from a variety of industries. Building a home requires carpenters, plumbers, electricians, and more. Unfortunately, there are not enough laborers in these trades to meet the demands of the home building projects that are in the works. As a result, new home construction is taking longer than expected and is also causing the cost of projects to increase dramatically.
Final Thoughts
The allure of building a house from the ground up seems appealing. At first glance, it seems like a great way to get exactly what you want. You do not have to worry about a kitchen that is too small or not having enough windows. Building your own house allows you the chance to build the home of your dream exactly as you envision it. Additionally, it might seem like a good way to avoid the stiff competition that home buyers are facing in a red hot real estate market. Unfortunately, all that glitters is not gold. Critical shortages of raw materials and skilled labor likely means that you will be waiting a long time for your house to be built on top of paying more than you would expect. In the end, building your own home might not be worth the trouble or the expense.
At the same time, the real estate market is improving for home buyers. The supply of homes available to buy is going up as home listings are increasing. In turn, prices are leveling off. As it stands, home buyers are now in a better position than they have been over the past 18 months whereas home builders are still in a pinch.
The bottom line is that before you make the decision to build a house, you should speak to a professional realtor. Take the time to learn about your local market and what types of homes are available for you. In the end, you might just find a house for sale that meets your needs that will be available much sooner and for much cheaper than a house you build. If you are deciding between building a house and buying a house and want to get more insight, contact us. The team at Streamline Realty is here to let you know everything you need to know about your market.
