Hello beautiful people! I’m attempting to buy my second house (had to sell the first one because of a divorce, otherwise I would have kept it), but now there are no affordable options in my area. I have a decent income, but housing costs might stretch my finances too thin. Houses that were $250k three years ago are now going for around $500k. It feels like a bad time to buy. I’m feeling stuck and unsure about how to proceed with getting a new home. Rent is even higher than a mortgage, and both are ridiculously expensive these days. Why are houses so expensive nowadays? Is it just me, or have prices skyrocketed everywhere? Would love to hear your thoughts or any insights you might have on this!
You’re not alone! Prices are high due to low supply, rising material costs, and lots of competition. Here’s the quick take:
- Why so expensive? Few houses, high demand, expensive building materials, bidding wars.
- What can you do? Talk to a realtor, get pre-approved for a mortgage, be patient. Renting isn’t always cheaper, either.
- Helpful resources: National Association of Realtors, Federal Housing Administration
Good luck navigating the market! It might take time, but finding your new home is possible.
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The market isn’t returning to pre-COVID prices; it’s simply following the principles of supply and demand. Many people are choosing to move here because it’s more affordable compared to other big cities.
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My husband bought something for $175, but when he called Bank of America, the person on the phone was rude and said they could only speak with the account holder. Neither of us has ever had an account with BoA. We’re not sure if it’s worth the risk. We’re planning to visit a branch to find out more. The item was bought in Arizona, but we live in Colorado.
It encompasses everything.
The cost of materials is high. In the past ten years, there have been shortages of lumber from US and Canadian suppliers and plaster and gypsum boards from China. Prices have soared for both.
The cost of labor is high. Not all labor used to build a house is paid minimum wage. Expertise is needed to assemble the components per engineering specifications, standard procedure, evolving building rules, and with the least amount of waste possible.
Land is costly. Each parcel of land attracts multiple bidders. Some people prefer single-family homes, multi-family homes, and enormous apartment buildings. Some people might choose mixed-use or commercial structures. Connecting a new home to the utilities might cost anywhere from $50,000 to $100,000.
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