RISMEDIA, Jan. 15, 2008-According to one company, one good thing has come out of the current housing slump. Less new construction has created less demand for building materials. As a result, materials prices have fallen sharply across the board. HomeCrafters’ co-owner, Troy Means, has noticed that building costs are down as much as $25 per square foot when bidding recent custom home projects.
“The first thing I always look at is the same thing our clients look at,” said Means. “I go to the very last page and look at the final number and the total price per square foot for the house. Lately, the number has surprised me. We’ll go through our bid five times over because the overall price is so much lower than two years ago.”
The decline in materials costs is mainly responsible for the drop in the overall price of custom built homes. Lumber, for instance, has dropped 36% since 2005. That makes today’s lumber prices, after adjusting for inflation, lower than they were in 1981.The cost of sheetrock, Means says, has fallen 30% in the past 12 months, and stucco is down 15%. He estimates excavation costs have fallen 20% as well, a surprising decline in a time when fuel prices have risen sharply. Additionally, as more insurance carriers compete for business in the construction industry, general liability insurance rates for general and subcontractors have fallen as much as 25%.
“If you are looking for a custom home to be built, now is a real good time,” said Means. “I think anybody who has been considering building a custom home should keep in mind that the architectural and bidding process could take up to 4 months, so I have been recommending to our clients to initiate this process now in order to take advantage of the current market prices. Even the new home communities, if you look at the incentives, the deals that are out there, what builders are offering and current interest rates, this is a pretty darn good time to buy.”
For more information, visit www.homecraftersreno.com or call 775-746-0808.