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Building a house is a huge undertaking, and the pandemic has changed how we see our homes. For many of us, we went from commuting to work to commuting to the living room. Our homes became the epicenter of our lives, and it’s brought a renewed desire for home personalization. The current shortage of homes, low mortgage rates, and high competition in the housing market create a challenging situation for buyers. With this in mind, building your own house sounds like it has more pros than cons. However, there are some current challenges to be aware of before diving into home construction.
The Data
The market for homebuyers has become very competitive, and bidding wars have become commonplace. According to the National Association of Realtors, existing-home sales fell 0.9% from the previous year, while the home price has increased 23.6%. Here in Central Kitsap County, in Q2 of 2021, we saw an average home sale price of $470K, up 22.7% year-over-year. Unfortunately, development companies aren’t building fast enough to compete with the housing demand.
But it looks like the situation is starting to improve on a national level. According to the U.S. Census Bureau, in July 2021, there were about 1.6 million permits for privately-owned housing units approved for construction. This shows the promise of a more balanced housing market in the future. There are also many housing developments that are in the works in Kitsap County, some of which are for single-family homes. But there have been many stops and starts here, as is the case in other areas.
Challenges with Building Your Own House
The pandemic’s effects are still echoing throughout the construction industry with shutdowns, supply, delivery, and labor shortages, and skyrocketing prices for materials. As such, the completion dates for almost all projects have been pushed back. Increased costs of materials have completely skewed planned budgets. Even finding people to fill your team can be complicated. However, industries, including construction, are beginning to bounce back.
Tips on Building Your Own House
Though conditions for building a home on your own aren’t ideal, we encourage prospective independent home builders to stay up on the latest industry news and keep their expectations in check.
With the given information above and your additional research, decide what you are most flexible with when it comes to your home building plans. Much of your construction journey during this time will be a game of give and take. There will be some aspects you may need to comprise. Additionally, realize that shortages will lead to delays in your timeline. Expect to be working on your house gradually as the construction industry slowly begins to bounce back from the effects of the pandemic. Budget as accurately as you can. The prices of materials will continue to fluctuate throughout the year. Put at least 15% of your total expected cost aside as a contingency budget to cover unexpected costs.
Lastly, we highly suggest working with a local real estate agent on the construction of your new home. If you are new to the area, a local expert will have all the insider knowledge and know-how to help you find the best location, create an excellent crew, and navigate legal documents, building permits, etc. A great real estate agent will serve as your advocate and project manager. And, our agents have strong connections with top-notch builders, designers, inspectors, lenders, and more. If you have any questions, don’t hesitate to reach out.
