Building a new home is one of the most popular ways of creating wealth, but it’s not all smooth sailing in this ever-changing market. It requires a lot of learning, research, and experience to fully understand all the risks one will be exposed to.
Many investors who opt to invest their life savings in a house nowadays are left wondering whether they should build in a buyer’s market or a seller’s market. Essentially, the million-dollar question is: when is a good time to build or not to build?
On one hand, there are plenty of benefits to building in a buyer’s market. There are opportunities such as increased affordability of construction materials and labor, easier scheduling, and more availability of different trades. Most of these expenses are variable, depending on the market, and they are often favorable to investors during a buyer’s market. Lower expenses equal a greater profit margin, that’s a no-brainer.
On the other hand, what if the house gets ready when the market is still down? You need to be prepared and ensure you have planned for this scenario. For one, you might decide to sell at a buyer market price and take advantage of buying the next investment property at a lower price or choose one of the many alternatives that would be more suitable to your condition. But all should be planned before starting to build.
Building a custom house needs about one year of continuous planning, investing, and professional work; hence, an investor will likely start building in a seller’s market and time the buyer’s market correctly when the building is done.
Obviously, it is not an easy answer. The answer depends on multiple variables, including the investor’s condition such as his financial situation, the type and size of the house he is planning to build, his sale and marketing strategies, his niche market, his desired markup, and many more. Others are general conditions such as; the market situation, lenders’ criteria, quality of the house, and so on.
Just like preparing an architectural plan for building a house, there is a need to prepare a plan for different scenarios incase the unknown does not bode well. This will be done through a complicated process that considers all known variables and minimizes the risk of the unknown. The answer is unique to the conditions of each investor and requires the necessary experience, research and time. You may wonder “who can provide this plan?” This is where a professional builder will step in.
With their years of experience, professional builders have gained valuable insights into different markets. They can lead investors through all kinds of obstacles in building a house in different markets. Professional builders offer help and guidance for making complicated decisions that protect the investor’s life savings.
A professional builder also provides high-quality homes at an affordable price which adds value and impresses the buyers. Having a brand name of a trusted professional builder also attracts more buyers in all types of markets, hot or cold.
In conclusion, it is advisable to build with an experienced and well-established professional building company. This is the only way to guarantee safety when going through the risk of building in and kind of market. With their expertise and track record, professional builders reduce risks of building and selling. Builders depend on their reputation for business, which is why they spend a lot of energy to ensure the home stands out. As an investor, you’re guaranteed the best designs and in-demand finishes.
You may wonder what the pros and cons of hiring professional builder vs an average builder are? For that answer, stay tuned for our next articles or call IRACA Group at 604 200 7678.
At IRACA Group construction we are Vancouver’s premier construction and renovation company. We are a North Vancouver-based custom home development expert. We specialize in luxury single-family residential homes, providing stellar home development and construction services to homeowners and investors. Offering services in everything from custom home renovation and modern home remodelling to 3D design and real estate consulting. Our skilled team of construction professionals & engineers have decades of experience across various housing & development projects throughout Vancouver. We are always at your fingertips so feel free to Contact Us!