Supply Chain Issues
“. . . Nearly everything needed in the homebuilding process is facing some sort of delay and subsequent price increase.”
“March Lumber, which had traded as low as $500 per thousand board feet in late August, blasted to $1,244…”
“When supplies are low, charges inevitably go up, . . . Meanwhile, a lack of availability is causing huge delays, meaning builders are struggling to stay on schedule.”
“Builders are grappling with supply-chain issues that are extending construction times and increasing costs.”
Skilled Labor Shortage
“The skilled labor shortage in the construction industry is not new – it’s been an issue for more than a decade now.”
“Overall this was a good report, . . . The supply of workers continues to fall short of demand, but the underlying momentum of the labor market recovery is strong, and falling COVID case counts provide further forward momentum.”
HousingWire explains how these things can impact move-up buyers today:
“The residential construction industry is facing a crisis as builders manage the critical shortage of building materials and labor. Explosive supply and labor costs are forcing long delays. . . .”
Pros of Buying Existing Homes
- Ease in financing accessibility: Having an existing home offers more collateral to lenders making it typically easier to obtain financing for an existing home.
- Ease in planning your move: Once you’ve purchased a home you can begin to plan your move for the closing date indicated on the contract.
- Less time to wait: Buying an existing home is faster than waiting for a new home to be built, especially right now.
- Curb appeal: Oftentimes there is established landscaping that only needs to be maintained or further customized, rather than starting grass, shrubs, trees, and flowers from scratch. The same can often be said for garages, patios, and deck spaces. Existing homes can be purchased with extra amenities such as central air, irrigation or security systems already installed. These exterior functionality and beautification items can quickly become a high expenditure when building a home.
- Appliances often accompany the sale: Accessory items are usually included such as stove, refrigerator, dishwasher, washer, and dryer.
- Fees: If you build in a new development, you could be subject to HOA fees and certain building restrictions, while older homes are often free from such limitations.
- Newer isn’t always greener: Despite recent green building practices, restoring or maintaining an existing home is still likely more environmentally sustainable than building a new one.
- They just don’t build them like they used to: While there are beautiful new homes and extremely skilled home builders out there, existing homes can oftentimes possess deeper character, historical significance, larger lot sizes, as well as a level of exceptional craftmanship, created by skilled artisans of another era, simply by virtue of the mass-production manner in which homes are constructed now, or current prices and availability of high quality/local materials.