CONSTRUCTION COSTS PROVE IT’S TIME TO BUY
Purchasing an existing home today may be one of the best investments available based on replacement costs. With the abundance of houses available for sale, most people overlook the fact that at some point we’ll have to build new houses to keep pace with demand. When that happens, builders will have to be able to turn a profit. Presently, in many areas, including most of Florida, the cost to build a house is significantly higher than the cost to buy a comparable existing home. With demand rising and more buyers entering the market, the supply of houses available for sale will eventually drop. When that happens, new construction activity will resume and likely drives up the cost for new homes. Buyers who purchase an existing home at today’s prices will also benefit from that increase.
Build New 2000 square foot home @ $100 per square foot = $200,000
Buy an existing 2000 square foot home today @ $100,000
This benefit to today’s buyer will only improve over time as the current numbers of existing houses available drop to more normal levels.