Originally posted by Flex
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Crazy Inflated Home Construction Costs?
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Originally posted by Playa View PostNobody is calling it what it is, but inflation is here and growing fast. This ^^^ is not a sustainable model. We can’t keep printing $, and acting like a drunk banker lending to a drunken sailor.
Truthfully we just replaced lax lending practices of the 2008 debacle with cheap money. This bubble will bust the same
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Originally posted by Playa View PostNobody is calling it what it is, but inflation is here and growing fast. This ^^^ is not a sustainable model. We can’t keep printing $, and acting like a drunk banker lending to a drunken sailor.
Truthfully we just replaced lax lending practices of the 2008 debacle with cheap money. This bubble will bust the same
I do believe inflation plays a part, but much smaller than what is being touted. Supply and Demand. I have been in the Insurance business for 15+ years and the amount of damage this freeze caused is not comparable to anything that I have ever seen. The amount of damage all across the state from every major city is unparalleled. A hail storm hits maybe a couple cities and causes some big changes, but this is flat out unheard of.
I have been dealing with Serv Pro of Deleware and Maryland for goodness sakes. They've literally packed up shop and moved South.
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I had my pier rebuilt at IKE it was 10K for the build. Just finished the rebuild from this last years storms and it was 30K for the rebuild.
Lumber is stupid high and not coming down. Cheaper wood from Canada is not making it into the states. Plants are not producing as much so demand is high and supply is low.
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Although inflation is a factor, I don't believe it's a significant factor at this point. I believe it mostly has to do with a home building market that already had high demand from all the people moving to this State in addition to historically low interest rates. Then combine that with the significant amount of damage caused by the February freeze. I know a couple insurance adjusters and the amount of damage caused by the freeze is eye opening to say the least.
I do agree the bubble will pop or at least start to deflate at some point. My guess is that repairs from the freeze damage will eventually get caught up and interest rates will eventually start to increase. Actually, rates have trickled up slightly over the last few weeks.
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Originally posted by scott.str View PostWe looked at buying a house here in Dfw and offered 7k over asking plus free rent back and other things. Thought it would be a decent offer. We where not in the top 25 I guess offered.
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The guys I know in Montana who have lumber yards selling primarily to contractors say it’s not going down if demand stays where it is now. An economic crash/ bubble bursting changes everything.
Our son is a builder and agreed. Low interest rates and people not spending discretionary $ during covid are fueling the demand.
Land and house prices in Montana are going up and supply is low.
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Yep
Originally posted by apkleinschmidt View PostDoes anyone have an educated guess as to when these super inflated material costs will normalize? End of 2021? 2022? I don't ever expect them to get back to pre COVID numbers but this is ridiculous.
We got the bid for our planned build and material costs are 70-120k more than anticipated on a 2200 sqft house. We will probably hit the pause button on construction and hang tight for a year or two to let costs go down if we have to. Any opinions on possibly giving up these low interest rates on the hope that material goes down in the next couple years? If it was a 20-30k difference I would just build but 100k difference is pretty substantial.
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Originally posted by scott.str View PostWe looked at buying a house here in Dfw and offered 7k over asking plus free rent back and other things. Thought it would be a decent offer. We where not in the top 25 I guess offered.
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