If you’ve been on the fence about building a home in Coastal Carolina, there are two big reasons to finalize your decision sooner rather than later: home prices and interest rates. Though home prices have stabilized compared to the last year and a half, they are still projected to increase for the foreseeable future. Interest rates are also relatively low compared to pre-pandemic rates, though these, too, have begun to rise.
Prices and Rates Expected to Climb
Today, there is certainly less volatility in the real estate market than we saw in 2020 and 2021. Then, prices were increasing at breakneck speed as demand shot up. All we heard were stories about bidding wars, waved inspections, and even waved appraisals as buyers brought cash to the closing table. Now, as demand cools, home prices are, too. But if you think they’ll start decreasing anytime soon, you may want to re-evaluate.
Zillow predicts home prices will rise 16.4% in the next year (as of February 2022), and much of that has to do with the cost of products and supplies. Lumber, while much more available than it was a year ago, continues to cost well above what it did pre-pandemic, and those costs continue to creep up. The same is true for just about every component of a home — from flooring to HVAC systems to paint. As with housing in general, the demand is just too high as manufacturers struggle to keep up, and prices reflect that.
Demand for new houses isn’t letting up anytime soon. The U.S. currently has underbuilt housing by at least 5.5 million homes. Even as the pace of building picks back up, it will take five or six more years before supply and demand levels out, continuing to buoy the price of homes.
Still-low interest rates are also a great reason to build a home now. Even with higher home prices, today’s low rates help to keep monthly mortgage payments reasonable for many home buyers. And if you have a certain budget that you must stick to, the ability to afford a larger home is an added perk of low interest rates. But they won’t stay low forever.
In early January, interest rates hit the highest they’d been since May 2020. The average rate for a 30-year fixed-rate loan was 3.22%, compared to 2.65% a year earlier. By the end of 2022, the National Association of REALTORS® forecasts that the rate will hit 3.7%. Locking in a lower interest rate today will save you money on your monthly payment, and tens of thousands of dollars over the course of your loan.
Now is the RIGHT Time to Buy or Build
If you were in “wait and see” mode for the last few years, you’ve probably looked extensively at our floorplans and chosen one or two that would be perfect for you and your family. And chances are you’ve identified the community or land where you’d love to build your new home. Now is the RIGHT time to start the building process, and with our efficient and proven process, designing and building a new home is easier and faster than ever.
If you are hesitant about the building process, but still want to live in a new home, JC Jackson Homes has several available homes that are complete, or will be finished in the near future. You can buy a brand new home now, locking in today’s interest rate and skipping the building process entirely. (Available homes sell fast, so be sure to act quickly!)
Contact us to learn all about new home financing, our proven process, and how you can start building the home in Coastal Carolina you’ve always wanted!