Should you build a home during the pandemic?

Do you dream of building your own home? Do you have a vision of a house that is customized and built to suit your own individual needs? Do you think buying a piece of land and building a home sounds like something you would enjoy doing?

If you answered yes to these questions, you want to build the home of your dream. You are probably worried about the uncertainty and challenges of building during the pandemic. While the environment is certainly different, now is the perfect time to build your own home.

Easy to sell your current home

There is no better time to sell your home. Real estate professionals and housing analysts are reporting record home sales across the country.  Homes are listing on the market and have multiple offers in a matter of days or even hours.

Home sales increased 5.9% in July compared to the previous month, according to the National Association of Realtors. Home transactions are 15.5% higher than 2019. It’s a sellers market right now.

“Home sellers are seeing their homes go under contract in record time, with nine new contracts for every 10 new listings,” National Association of Realtors Chief Economist Lawrence Yun said.

The trend is not expected to decline. The housing market is not expected to remain hot foreseeable future. That means you should have no problem selling your current home, and it will most likely see significant appreciation. You can use all that equity to help build the home of your dream.

Low housing stock

It’s a difficult time to buy a pre-existing home. Given the uncertainty of the pandemic, fewer people are putting their homes on the market, increasing the demand for the limited housing stock

According to real estate company Redfin, the supply of existing homes on the market is down 24 percent. There were roughly 189,000 fewer homes on the market last month than during the same period in 2019.

“For many homeowners, a pandemic is not the ideal time to move and have strangers come through their homes, so those who have the flexibility are putting off listing for now,” said Redfin lead economist Taylor Marr. 

That means you will need to build a home if you want a change. Now is the perfect time to build a home, because builders are in construction mode. They are looking to significantly increase the supply of houses to meet the increased demand.

Record-low interest rates

It’s cheaper to build a home than ever before. If you build a home now, you will be locking in the lowest interest rates in history. The rate for a 30-year mortgage is around 3 percent, and a 15-year mortgage has seen rates under 3 percent.

That means you can afford to build a better house for less money. Your monthly payments will be less, and you will be able to work with a builder to design a custom home. These rates will not be around forever, however. Rates are forecast to start increasing again early next year and are showing signs they might increase slightly in the fall.

“With interest rates at the lowest level in decades, if you’re in the market for a home, now is a good time to buy,” said Barbara Friedberg with Robo-Avisor Pros.

Building is safer

Building a new home puts you at less risk during the pandemic. You and your real estate agent will have to tour numerous homes in order to find your dream home. That means you are traveling to places and entering other’s people homes, something that puts you at greater risk during the pandemic.

Building is a safer alternative. You can work with the builder over the phone and through video conferencing on the design of the house. Most documents can be signed electronically.

You might only have to meet in person with the builder a couple of times in order to approve plans and inspect the home when construction is finished. This limits your exposure and reduces the amount of contact you have with other people.

Lower repair costs

You reduce your expenses during uncertain times when you build. Repair costs are one of the biggest drawbacks to owning an older home. When you build a home, everything is brand new. You don’t have to deal with broken faucets or putting on a new roof. A new home is a quality investment, because you don’t have to pay hundreds of dollars every year to maintain the home.

As well, everything is customized to meet your needs. You don’t have to pay for renovations. You don’t have to spend money to improve the kitchen or remodel the bathroom. Everything is built to your specifications. That is much better than buying a home or staying in your current home. It pays to build.