The Expert Podcast

• Topic: The Rising Costs of Building a Home: What You Need to Know
• Overview: This episode dives into the dramatic rise in home construction costs and breaks down the key factors driving these increases. We’ll also explore the impact of these changes on home prices, the real estate market, and whether prices will decrease anytime soon.
• Key Points:
  • House Price Increases: Over the last two years, house prices have soared due to material shortages and rising costs.
  • Cost Breakdown:
    • Materials for building an average-size home have increased by 42% since 2021.
    • The cost of materials has risen by roughly $35,000, bringing the total material cost for a home to $118,000.
    • Labor and land costs make up the remaining two-thirds of the overall cost.
  • Average Home Costs: The typical cost of building a new home has reached around $360,000, with final prices for consumers ranging from $415,000 to $420,000.
  • Rising Material and Labor Costs: The costs for framing lumber, concrete, windows, doors, siding, plumbing, cabinets, and other essential items have all risen sharply.
  • Impact on Home Builders: Overhead costs, including insurance, land, and construction site work, have also increased.
  • Will Prices Decrease? Despite slowing demand, home prices are unlikely to drop due to locked-in costs for materials, labor, and logistics. Prices for lumber, flooring, and other materials will remain stable or rise further.
• Listener Engagement:
  • If you're a home builder, consumer, or employee in the home construction industry, share your thoughts with us in the comments. Are you seeing any changes in client demand, employee compensation, or commission rates?