Tuesday, April 28, 2009
Building Costs & the Recession
I think this a good time to build or remodel as prices are the lowest we've seen in the 20 or so years we've been here doing Design Build in Seattle!
We've been told by our largest lumber supplier that construction material costs are at 1986 levels! Well, I don't know about that, but I do know that for lumber we are paying 30% less than last year and about 40% less than 1-1/2 years ago! Further, we are getting some of the lowest estimates from our subcontractors we've ever seen. And then there are tax credits - credits for energy saving materials such as insulation, doors & windows, upgraded heating/cooling systems, etc. And really interestingly, you can get a 30% federal tax credit for renewable energy installations, such as solar electric (photovoltaic) or small wind turbine systems. Add to this that the state has authorized utilities to buy back your excess generated power at rates higher than they charge, and you can pay for your system sooner than later. These incentives, coupled with ridiculously low interest rates (we've seen clients obtain financing at 3.75% and 4.25% for their projects or refinances), make this a incredibly good time to build or remodel and save money.
For me anyway, putting money into my home is one investment that I can always enjoy because I live with it every day. It doesn't go away like some other investments have!
We've been told by our largest lumber supplier that construction material costs are at 1986 levels! Well, I don't know about that, but I do know that for lumber we are paying 30% less than last year and about 40% less than 1-1/2 years ago! Further, we are getting some of the lowest estimates from our subcontractors we've ever seen. And then there are tax credits - credits for energy saving materials such as insulation, doors & windows, upgraded heating/cooling systems, etc. And really interestingly, you can get a 30% federal tax credit for renewable energy installations, such as solar electric (photovoltaic) or small wind turbine systems. Add to this that the state has authorized utilities to buy back your excess generated power at rates higher than they charge, and you can pay for your system sooner than later. These incentives, coupled with ridiculously low interest rates (we've seen clients obtain financing at 3.75% and 4.25% for their projects or refinances), make this a incredibly good time to build or remodel and save money.
For me anyway, putting money into my home is one investment that I can always enjoy because I live with it every day. It doesn't go away like some other investments have!
Labels: construction costs and financing, recession
