Home Building-Know Your Real Estate Market

Home Building-Know Your Real Estate Market

In “Know Your real Estate Market, Part 2”, I ended with saying “There hasn’t been a better time to buy a house, build a house or remodel a house in my memory.

I’ve had a flurry of “whys” for that statement so let me expand that thought.
For buyers, here’s an example of good buys in the LA basin:

From: Peter Viles, LA Times:

Forty new homes were auctioned off in roughly an hour on Sunday.
Prices and discounts? A home "once listed" at $608,000 sold for $425,000, a "price cut" of 30%.
A real price cut? Who knows -- it's hard to say whether the "once listed" price was ever close to a market price.
Financing? Up to 100% financing for auction buyers. Who says no-money-down is dead?”

And, for those of you apprehensibly thinking about building or remodeling, here are the facts:
1. Land costs (building sites) have fallen. That is a first in my memory!
2. Lumber costs have fallen.
3. Other building material costs have fallen.
4. Mortgage and construction loan interest rates have fallen.
5. Lender fees have fallen.
6. Subcontractor’s labor costs have fallen.
7. Subcontractors have become more available and compliant.
8. General contractors? The same.

Are costs and values going to continue to fall or start rising again? I doubt they can go much lower, and in some areas they are already rising. That’s why YOU have to know YOUR real estate market.
Once they start rising, you have already missed the optimum point in time.

Carl