Be Prepared for Consistent Change
Regardless of the exact subject matter, when someone hears about the housing market or home construction this year, the consensus is almost unanimous and instantaneous: “It’s crazy right now!”
For three area experts—Shannon Meyer, President of Cypress Homes in Appleton; Jodi Vandermolen, Executive Officer of the Winnegamie Home Builders Association; and Megan Schlimm, Vice President of Marketing & Operations of Home Builders Association of the Fox Cities—the trends of the season are evident, and also a bit contradicting.
Words like “changing” and “consistent” come up, as well as material shortages and expected delays in shipping and labor. The three agree that looking to professionals is key, as well as communicating with those working on the project throughout the build. Rates for material are on the rise, but are still considered affordable.
Making the decision to sell an existing home and look at building new should be done after weighing pros and cons and considering all aspects of the process. Here’s what Meyer, Vandermolen and Schlimm have to say about what’s going on in home construction:
One word to describe home construction in 2022:
What are some trends you’re seeing in the industry?
MS: Functional floor plans with home offices, large pantries, primary bedroom with access to walk-in closets and laundry room, digital technology (Wi-Fi thermostats, garage doors, doorbells, etc.), gathering areas for entertaining like oversized kitchen islands and covered patios.
JV: We have seen more windows being placed in homes to allow more natural lighting, the open concept is still very popular so that you can be all in the same area with your family, multipurpose rooms, a room that can be used as a spare bedroom, office or play area for children. Mud rooms, first floor master suites, LED lighted mirrors for the bathroom, tech savvy homes that you can control like your heat/air, garage doors, entry doors, shades, security, and many more things. We have also seen more people building in rural areas due to working from home, they do not need to worry about the drive into work, and can enjoy the rural lifestyle and still work from a larger city.
SM: Working remote has increased the need/desire for home offices.
When it comes to home building, what is the most significant shift the industry has seen since COVID?
SM: I would say the supply chain and labor force. We have changed many of our processes to adjust to ensure we receive our products as needed. We have also had to extend our build times to project for any unforeseen delays that may arise. Cypress Homes has been very fortunate that we have built great relationships with our suppliers and contractors, some have been with us since 1994, that have taken care of us and our clients throughout allocations and building supply shortages/delays and filled our contracts timely.
MS: Many labor, material and supply shortages still exist from COVID. Lengthy delays in ordering material have pushed timelines for builds and remodeling projects. There has been some reprieve in materials and supply timelines, however labor shortages remain an issue in the trades industry, and we don’t see that changing soon.
What is your advice for people who are interested in building a home in the next couple of years?
JV: Despite rising costs and interest rates, building your home is an investment and should be looked at as a long-term financial decision. Make sure you can communicate with your builder. WHBA has a full list of builders that are licensed and insured.
MS: Planning is the key to a smooth building or remodeling experience. With the increased timing needed to order material and supplies, it’s important to explore and know what you want to stay on schedule. If you need tangible examples of what floor plans, products and finishes look like in a completed home, tour the Fox Cities Parade of Homes to get ideas and meet with local builders. SM: Build now, don’t wait! It has been projected that now will be the least expensive time to build in the next 3-5 years. Lumber is what is most volatile, meaning the pricing will go up and down, lumber is currently flat and at the lowest pricing it has been at all year! The other materials that have taken increases, typically once they go up they don’t come back down. Rates are on the rise but are still at a great rate! If you look back historically we had a great run with them being low. There are many mortgage programs to take advantage of to help lock in at lower rates including the Adjustable Rate Mortgage, which today is very popular. Construction loans have also evolved to allow you to lock in your rate now at the start of your construction which allows you to lock in the lowest rate. The existing home market is still giving an excellent return on equity on your current home so it is a great time to sell and start your build!