The housing market has been off the chain since 2020. All over the United States, homes have been selling quickly and for thousands of dollars above asking price, leaving first-time buyers struggling.
Photo by Francesca Tosolini on Unsplash
Instead of trying to find the right home in a competitive market, many people are turning to new construction instead. In December 2021 alone, there were 1,702,000 new residential construction projects and 1,295,000 residential completions.
Home buyers want customization
Buying a new home is a big endeavor. Homes aren’t cheap right now, so it makes sense that some people would spend a little bit more time and money to get a new construction they can customize.
If you’re going to pay a premium in the marketplace for an existing home, you may as well spend that extra money on a new construction and get exactly what you want. Floor plans are readily available, and home builders like Natale add new floor plans regularly.
Building a home from scratch allows buyers to customize the layout and design, including the fixtures. In short, you get what you want with a new construction and you don’t have to settle.
New constructions avoid bidding wars
The biggest inconvenience of buying a home in the current market is dealing with bidding wars. Many people have a real estate agent to negotiate on their behalf, but it’s still a frustrating experience.
Many buyers are getting outbid by wealthy investors and corporations that offer thousands above asking price. In 2021, over 4,500 Seattle homes sold for at least $100,000 over asking price. A total of 146 homes sold for $300,000 above asking price. That’s astronomical.
The high premiums created a kind of chain reaction where homes were being listed higher than their value. Since supply has been short, many of those homes have sold.
In 2022, the market has cooled off a bit, but it is still overpriced. First-time buyers don’t stand a chance with those sales prices. In cities like Seattle, it’s better to skip the bidding wars entirely because in the end, a rich investor or corporation is going to win. The average first-time home buyer can’t afford to offer a higher premium, so they have to bow out of the negotiations and concede to a higher bidder.
Since over-priced bids are happening so often, many people think it’s not worth getting involved. Contracting a new construction is easier and less stressful. One of the only points of concern is the contractors making mistakes. However, if you choose a reputable company, they’ll hire competent contractors.
New constructions are easier
Buying a home has never been a simple process, but it’s never been all that complicated, either. There are plenty of things you need to know and there are processes, rules, and regulations. However, it’s never been a battle that sucks all of your energy and drains you.
Home buyers have been exerting enormous amounts of energy chasing homes that end up being pulled out from underneath them by excessive bids. After spending all of their time and energy trying to buy a home, it’s frustrating to lose to a higher bidder.
If it only happened once, it wouldn’t be so bad, but home buyers in certain areas are being outbid multiple times, making the task of finding a property exhausting.
Supply is short
The supply of homes has been short, but it’s dwindling even more. Home buyers, whether new or experienced, are struggling to find their ideal property. With the options available, many have had to settle for homes that don’t exactly fit their needs.
Another big problem with the market is that people can’t just put their home on the market and expect to find a new property before closing. People are putting their homes on the market and selling them without a problem, but they are struggling to find a new home to buy at a reasonable price.
Existing homeowners are better off contracting a new construction before they put their home on the market. This way, there’s no need to scramble to buy a new house that may not even be what they want.
New home constructions are ideal
Whether you’re looking to move to a new location or you’re a first-time buyer, a new construction might be your best option. If you don’t want to deal with the bidding wars and high prices, talk to a builder to find out how you can get a new home built. You’ll have a better chance of getting a home you’ll enjoy.
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