One Of The Biggest Problems With New Home Construction Today
It was only about three years ago, that new home
construction was making money hand over fist. It seemed like new homes
and tracks of homes were going up all over the place, all over the
country. It isn’t this way today and I don't know how long it's going to
be, before things actually change.
One of the biggest problems with new construction today is that most home builders can't build homes as cheap as the ones that are still on the market. There was a home in our neighborhood that sold for $170,000 less than one year ago. The property is probably worth at least $125,000, with utilities already hooked up to it.
I don't know of any homeowner that could build a house today for less than $50,000. I'm not saying that it can't be done, but if it could, how much profit would actually be in it. There are plenty of lots around that are overpriced, waiting for some poor fool to purchase them. This isn't good for home builders, but I would like to share something with you that actually is.
Obviously home builders today are having problems purchasing properties cheap enough to build homes on and make a profit, but things are going to change and they always do. We need to remember that people are still populating, who haven't purchased or can't afford to purchase homes right now. There's a good chance that most of these people are saving up for a future down payment on their beautiful new dream home.
2009 might not be the best year for home builders, but you had better prepare for the next housing boom, because it could only be a few years away. I don't know if it's true or not, but I heard a reputable real estate professional tell a large group of people at a seminar that I was attending, that by the year 2011, there's going to be one heck of a housing boom. That usually translates into more money for home builders with less risk.