Home Building Hurdles and Construction loan Declines
Has home building declined in recent years? The answer to that question is yes. In fact, is has reached its lowest rate in 17 years. [I:0:T]
What this means is that the number of homes or apartments being built will be the fewest since the Second World War. The reason for this is simple, not that many people are willing to build a home and banks are a bit hesitant whether or not to approve a loan.
While most home values go up after how many years, in some cases like during the financial crisis, its value could go down. Some analyst said that the average home value has only kept up with inflation over the last few decades so you dont really gain that much.
If you are employed and you are told that you have to relocate, it will be hard to move right away since it takes time to sell a house.
Should there be any problems with the house, you dont call your landlord since there is none. You will have to find a specialist to figure out what is wrong in order to fix it.
Since the property of most homes has also gone down, many of the current homeowners cant even make a profit if they decide to sell it now in hopes of building a new one.
Believe it not, the cost per square foot is higher for a small home than a big one. Why? Because the cost of items is spread over and a two story home if that is what you want has a smaller roof and foundation. The same goes for plumbing and ventilation.
Another thing that could reduce cost is the shape of the home. Houses that are shaped like a rectangle, square or dome shaped are more affordable to build since there are not that many angles or corners which increases the amount of labor and the materials that will be needed.
Since your house is new, it is more energy efficient compared to older homes thanks to new technology and you are compliant with new environmental regulations.
There is no doubt that the current financial crisis is the cause of the decline in home building. The good news is that things will change for the better in less than 5 years so in the mean time, those who are paying for a home should sit tight until the bailout and any other remedy the government is trying works. As for those who are renting, be patient because now is not the right time to consider building a home.
There are bargains to be found out there in the real estate marketplace but make sure you pick the best projects in the best areas.
So what should people do? The right thing to do as home building decline continues is simply to ride it out and then see what happens in the next 3 to 5 years. Yes that means still renting that place you have been living in for a few more years but look at the bright side, you are not one of hundreds of Americans who are forced to foreclose their homes and no longer have a place to stay.
The sad reality out of all of this is that this is not expected to stabilize any time soon. The value of most homes will continue to drop for 5 years or even more which bring us back to the conclusion that it is better to rent than to build a home.
What this means is that the number of homes or apartments being built will be the fewest since the Second World War. The reason for this is simple, not that many people are willing to build a home and banks are a bit hesitant whether or not to approve a loan.
While most home values go up after how many years, in some cases like during the financial crisis, its value could go down. Some analyst said that the average home value has only kept up with inflation over the last few decades so you dont really gain that much.
If you are employed and you are told that you have to relocate, it will be hard to move right away since it takes time to sell a house.
Should there be any problems with the house, you dont call your landlord since there is none. You will have to find a specialist to figure out what is wrong in order to fix it.
Since the property of most homes has also gone down, many of the current homeowners cant even make a profit if they decide to sell it now in hopes of building a new one.
Believe it not, the cost per square foot is higher for a small home than a big one. Why? Because the cost of items is spread over and a two story home if that is what you want has a smaller roof and foundation. The same goes for plumbing and ventilation.
Another thing that could reduce cost is the shape of the home. Houses that are shaped like a rectangle, square or dome shaped are more affordable to build since there are not that many angles or corners which increases the amount of labor and the materials that will be needed.
Since your house is new, it is more energy efficient compared to older homes thanks to new technology and you are compliant with new environmental regulations.
There is no doubt that the current financial crisis is the cause of the decline in home building. The good news is that things will change for the better in less than 5 years so in the mean time, those who are paying for a home should sit tight until the bailout and any other remedy the government is trying works. As for those who are renting, be patient because now is not the right time to consider building a home.
There are bargains to be found out there in the real estate marketplace but make sure you pick the best projects in the best areas.
So what should people do? The right thing to do as home building decline continues is simply to ride it out and then see what happens in the next 3 to 5 years. Yes that means still renting that place you have been living in for a few more years but look at the bright side, you are not one of hundreds of Americans who are forced to foreclose their homes and no longer have a place to stay.
The sad reality out of all of this is that this is not expected to stabilize any time soon. The value of most homes will continue to drop for 5 years or even more which bring us back to the conclusion that it is better to rent than to build a home.
About the Author:
If your looking for a construction loan to build your dream home and want new ideas on home Building, or just Building a new home download a free construction loan e-book on our website.
posted by Credit Counseling at
5:21 PM
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