16th Nov, 2013

Cost Trends to Build Fredericksburg Texas Homes

As the construction of new Fredericksburg Texas homes heats up, prices for building materials may actually begin to go down.  So this could be the right time to find vacant land or a home site in one of Fredericksburg’s country style subdivisions.

Fredericksburg TX homes for saleTerra Grande Magazine (10/13), Journal of the Real Estate Center at Texas A&M University, explains the construction cost breakdowns over the past several years in Texas.  Texas builders have seen prices for lumber up as much as 35 percent in Dallas, with prices for particleboard even higher.

Building costs are determined by the price of commodities and minerals, wages, and the law of supply and demand.  Since the downturn in the national real estate market, overall construction costs have been increasing.  This is due to the fact that so many producers stepped out of the market.  As the housing market got back on track April 2012 through May 2013, new materials production increased supply.  When output and supply becomes equalized, those price increases will start to slow down.

The cost of wood and lumber is of special concern.  Wood and lumber prices make up 22 percent of the average construction costs.  Wood elements include framing, trusses, interior and exterior doors, cabinets, countertops, etc.  Prices were up 13 percent in 2009 at 11 percent in 2011.  The last time prices reached high levels (2004), they began to slow down and then decrease.

Then there are the costs for the excavation, foundation, and backfill (9.3 %).  Plumbing and wiring (10.4%) prices are increasing to accommodate new codes and the higher prices of copper.  Other building costs for Fredericksburg Texas homes include fees, cleaning, insurance, utilities, heating, carpets, cabinetry – a broad range of cost adding about 4-5+ % each to the total costs of constructing a home.

Fredericksberg TX homesWhile the costs for labor have decreased nationwide, hourly construction workers in Texas have seen wage increases of 5.8 %.  Nonetheless, salaries are still not back to the levels before the market downturn.

Many of the prices for building materials and the costs of building will level out when suppliers are able to meet the demand in the industry.  Some prices are affected by international demand for products produced in the United States.  To save some dollars on the building of custom Fredericksburg Texas homes, interested buyers may just want to decide on the property now.  Then, these buyers will be ready to take advantage of lower interest rates, wages, and the probability that materials costs will be going down soon.

Buying and Selling Fredericksburg Texas Homes

For more information about homes and investment properties in Texas Hill Country, contact Dale Cook at 830-992-0056.

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