Most of us know that material costs have been rising a lot, along with labor costs. The difference between large, production builders’ increased costs and how much more a smaller, custom builder must pay for materials can make a big difference in the final cost of a home. e2Value provides replacement costs for residences, which means a builder is basically building the home as a custom-built house. The costs versus a production builder who is building tens or hundreds of homes at a time are very different.
The National Association of Home Builders (NAHB) recently released their NAHB/Wells Fargo Housing Market Index (HMI) with details about the materials cost changes during the last year. While the percentage that builders reported varies, 28.4% of builders who responded to the NAHB survey answered they increased by 5% to 9.99%. The median increase was 6.7%. The larger the builder, the lower the cost increase. This may be due to the larger builders’ abilities to amass materials before price increases, have longer-term contracts with suppliers or have stronger ability to negotiate price increases.
e2Value keeps up with changes in costs to provide fast, cost-effective and accurate replacement cost valuations. We work from the Florida Keys to the Arctic Circle, Newfoundland to Alaska. We value structures ranging from Park Model manufactured homes, regular manufactured homes, log cabins, cottages on a lake, suburban homes, the world’s most luxurious and famous homes, retail office space, barns, silos and even scales in a grain bin. Contact us for more information about our estimator tools.