Over the course of a year, the coronavirus took the real estate industry and flipped it on its head. What once was a buyer’s paradise is now a seller’s dream. So, if you were hoping to purchase your first home, now might not be the best time. Of course, you could get a historically low mortgage rate if you do decide to buy. However, you’ll likely pay more over a longer period of time, which certainly doesn’t do you any favors.
Instead of settling for a mediocre home outside your budget, why not build your own exactly how you envision it? In 2021, there are a handful of good reasons to do just that.
Home Values Are High
Mortgage rates hit record lows for months in 2020, fueling the demand for homes. Instead of building, most people chose to purchase pre-existing houses. Unfortunately for buyers, this high demand also drove up home values. In October, prices rose 8.4% from a year earlier and 7% from the month previous. Now, experts predict that homes will only become more expensive, albeit at a much slower pace than last year.
Housing Inventory is Limited
Of course, a high demand for homes has also led to a dramatic decrease in inventory. In late November, the market only had a 2.3 month supply of inventory. Since then, a few more homes have made it into the market. Still, finding a decent home for a good price is nearly impossible.
Subsequently, many who were once hoping to buy have decided to build instead. This alternative might save first time buyers more money in the long run and get them into a home sooner than if they had waited for prices to drop again.
Housing Production is Growing
More Americans are working from home than ever before. If you’ve transitioned to a home office, too, now might be the perfect time to build a new house or add onto your existing one. It wouldn’t hurt to have an office all to yourself, you know.
Luckily, housing production is growing, effectively driving down construction prices and making renovations more affordable to the average homeowner. Of course, constructing a home from the ground up will still require a fair amount of money and time. However, with all the time you’re spending at home, investing in a comfortable place to live and work might be worth it.
Taking the Leap
If you’re ready to take the leap and finally build your dream home, the first thing you need to do is conduct some preliminary research. Where is the best place to build in 2021? Does the local municipality require you to have a construction permit or can you renovate without one? Understand exactly what you’re getting yourself into before you break ground. Then, if things go south, you’ll already be prepared to handle them so you can finish your home sooner rather than later.
Author bio: Rose Morrison is the managing editor of Renovated, where she offers advice on home renovation, maintenance, and organization.
