New home prices are surging driven by both demand and the sky rocketing cost of materials. Lumber cost alone has gone up by 170% from a year ago along with all other materials needed to complete a home. Some people are canceling contracts because of higher prices demanded by builders. Some builders are using lotteries to sell homes. To compound the problem, there is very little inventory related to resale homes. So those prices are going up to driven by intense demand. There are just very few existing houses on the market.
So what to do. Of course, it is a seller's market so demanding top dollar for the sale of your home is logical. But is it a good time to buy. The answer is Yes and No. If you will need a mortgage to purchase a home; then getting one now makes sense since mortgage interest rates are at historical lows. So even if you overpay a bit now, since your payments will be much lower than when rates go up, you should be ok. However, if you are a cash buyer, maybe it makes sense to sell and then rent until the markets cool off. The key is to sell when everybody else is buying and buy when everybody else is selling.
Of course, timing the real estate market, like timing the stock market does not always work out. But, if you can play the long game, you could make a lot of money. At Paragon Home Resources, we assist with life decisions. We can help you determine what options are best for you. We work with families all over the country to sell and buy homes. We have been there done that thousands of times so we know all about timing the market.
