JW Mashburn Homes

One of the most frequently asked questions we receive is; "When are new home prices going to come down"?  The answer to that is, "Yesterday"  Let me explain,  The cost of construction is as low as it is going to get yesterday and today for the foreseeable future.  Why?  Because there is still a demand for materials but, the main reason is the price of oil.  Oil affects the entire spectrum of new home construction such as, product development, transportation and labor.  The price of oil is again nearing $100 a barrel and this means higher costs for everything we consume and we all know when prices go up, they rarely come down.

The next logical question would be; "Is it better to wait or buy now"?  This depends on how much of a gambler you are?  There are two major areas you need to look at in order to make this decision. First, the price of new home construction and we already know the cost of construction is going up, not down.  The second, is interest rates.  Clearly, we don't have a crystal ball to gaze into for the answer and no one has been able to predict exactly when rates will increase or decrease with any certainty.  But, we do have historical data that we can use to make a "Best Guess" on rates.  As of now, we believe rates will remain at around 5% for the next few months.  Of course, this could change tomorrow with any number of events that could have an impact on the economy.

In order to make an intelligent and informed decision you need to weigh these two factors carefully.  Here are a few questions you might want to ask yourself, if you wait.  1. If prices do come down, unlikely, and rates go up what have I gained or lost?  2. If prices go up and rates go down, what have I gained or lost?  3. What if prices and rates go up, what have I gained or lost?  What if prices and rates go down, are you the gambler? 

Buying or building a new home certainly isn't just one "big" decision, it is a series of smaller and more manageable decisions based on the best information you have at the time.  Stop by our model home located at 2828 SW 140th street in The Villas at Cascata Lakes and let us help you!!

Tony McGrew