The price per square foot to build or buy is growing substantially by the month it seems. The only thing that is really helping the market is the low interest rates on mortgage loans and we don’t really know how long that may last. With that being said you are always faced with the ever intriguing question “Do I buy or build?”
I think it ultimately comes down to where you are in life. If you are a first time homebuyer my suggestion would be to buy. Most builders today are selling what is known as spec homes. These are homes that the builder has built on a lot that he owns and puts the house for sale. Usually the price per square foot is compatible with the industry and most times you get a really nice house for a reasonable price.
Production built homes such as DSLD Homes and DR Horton may be the option for you. See the blog post on Production Building vs. Custom Home Builders for more information on this.
If you feel that a new home is not for you. Then buy an older home that can be easily renovated and gain some equity, live in it for a couple years and put it on the market and use that equity to build your dream home.
If you are looking to build, figure out a budget that you can afford. There are a plethora of mortgage calculators online that can help with making that decision. Consult with a builder, if you are in need of one I know a good one whose information can be found under the contact tab on this website. Don’t be afraid to ask questions even if you feel like they are stupid questions. The more information you have the better off you are. Don’t make any assumptions when it comes to hiring a builder. Know exactly what you are contracting him or her for.
See the blog post on Dealing With Contractors for more information.
How much can you afford
We believe this is the question that will ultimately determine and guide your entire home buying experience. In today’s world “keeping up with the Joneses” is more prevalent than ever. More and more our happiness is becoming defined by what things make other people happy. We don’t fully understand what creating our own happiness means. We think that because someone is happy having a big home, a nice car, and tons of toys that in turn will make us happy as well no matter what the cost. So we strain our financial situation for an image that is created out of someone else’s happiness. But the truth is that more and more people are miserable and unhappy. In January 2020 Capital One produced an article that stated that 58% of Americans feel that their finances control their life.
Don’t add to the stress of the home buying process by stretching yourself beyond your means. According to Google the average interest rate for Mortgage Loans in Louisiana are 3.2% (March 2021). On a $250,000.00 loan the average monthly payment would be $1,081.00 per month with 100% financing. This does not include Private Mortgage Insurance (PMI) or any escrowed insurance such as Homeowner’s Insurance or Flood Insurance if needed.
Don’t be afraid to start small, sell, and move a couple of times. We know we all want the home of a lifetime to create tons of memories in. But those memories could be better created without a financial strain.
Figure out what you can afford and stick to it. No matter what the bank tells you they think you can afford.
The next blog post will help you define whether Buying or Building is more suited for you.
We hope you find all of the information provided useful and intriguing. We hope to spark within you a strength to endure your achievement as a human being looking to get ahead in life. This is a place to find mental wellness, management techniques, and industry information whether it be for buying your home, building your home, building a business, or just wanting to be a better person in life. Yes, we are homebuilders but we believe a new home is a pivotal moment in life that can project you on a path of making your dreams a reality. It’s not just about the house it’s about the people that create the memories in the house they call home.