You’ve heard there’s a lack of new homes, both new and used, available to buy. How can that be if there are houses going up all the time?
According to a 2016 story in the Corvallis Gazette-Times, between 2008 to 2011 fewer than 40 homes were built each year in Corvallis. Before the recession hit, there were nearly 200 houses constructed in the city each year, according to the city of Corvallis data. In the last 12 months, there have been 66 new homes sold in Benton County and 207 in Linn County.
Part of the reason for the shortage of new homes during this time span is many builders, who had spec houses built but were foreclosed on or had property to build on, lost their business and found other careers or retired when the housing crash happened.
The other part being the builders that are left are having problems making the dollars and cents work out to make it a profitable venture.
Capital improvement costs are one of the reasons builders are not putting new homes up faster. It’s things like streets and sidewalks that city’s say have to be in place in a new subdivision that has builders putting the brakes on building new houses. And it’s not just the paying the subcontractor to do the job, it’s paying the city it’s fees for the permits to do the job.
Then there’s the dollars and cents of actually building the house. The basic construction has gone up about $55 a square foot in the last three years. New construction in 2014 cost about $132 per square foot. Today those costs are $187 per square foot. Not only has the cost per square foot gone up but the houses have increased in size about 200 square feet. Today in Linn County houses average 1,922 sq ft and sell for an average of $308,010 while houses in Benton County average 2,222 sq ft and sell for about $375,3222.
For perspective, a 1,500 square foot house in 2014 would cost $198,000. Today that same house would be $280,500. An increase of $82,500. A house that size is a rarity these days, on average houses are 2,000 sq. ft.
If you’re ready to buy your new home, let the Gregory Home Team help you in your search.
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Gregory Home Team – Keller Williams