In addition to the pool we just put in (and the patio I am doing myself) my wife and I plan on a home renovation. This renovation adds only 385 sq ft to the footprint of my house - it is not unsubstantial by any means as it will be new siding, new roof, new mater bedroom over existing single story portion of my house, new 16x24 single story story family room, new central AC as well as a finished basement space under the family room. However, the initial estimate I was given was $279K (which i thought was a tad on the high side) now the final estimate is $500k. These prices are simply not sustainable. How is the home construction industry coping? Is it just high end construction that is still being green-lit? I mean if i were to build a 1000 sq ft new home would it really be over $500k in construction costs? Is the price I am getting simply a reflection of the material costs or am I competing against multi-millionaires who are willing to pay anything for construction?
Construction costs
- Thread starter jamjam
- Start date
Those numbers seem obscene. While material prices are at all time highs any decent contractor is already overloaded with work. Most likely they're too busy to do your job so they put a price on it so high that if you bite they will figure out a way to make it happen.
I have gotten 3 quotes and they are all in the same ballpark - the lowest quote was $400k (after being told was a $250k-$275k) project
- Jul 3, 2013
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It is crazzzy right now, no way would I try to build anything out of wood... There is no or little supply left so the prices are reflecting... The commercial projects are still being built so the prices are still going up and will continue until the products are being produced again.. The problem being no one wants to work for less than they are getting sitting at home on the couch and being safe from COVID...
I just read an article about "just in time manufacturing" Lean manufacturing - Wikipedia
Lumber has been in this along with every other building supply product...
I just read an article about "just in time manufacturing" Lean manufacturing - Wikipedia
Lumber has been in this along with every other building supply product...
i have been saving up for this project for 4 years and right when we were ready to do it the world went mad. Meanwhile I am sitting on a substantial amount of cash doing nothing (probably missed out on $80K in gains by stockpiling cash for this project). I am pretty depressed after getting this final quote this morning. I can't figure out what these numbers will be in a year.
jark87
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- Jun 5, 2011
- 1,336
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- Jandy Aquapure 1400
Personally, I think it’s less the price of materials and more about consumer demand. The pandemic had everyone looking for comfortable isolation, which led to lots of backyard oasis projects. Builders could charge what they wanted and still be selective about which projects to take on. In addition, more people wanted out of high density housing (like apartments) and into single family homes. Few homes were on the market due to the pandemic, which drove up prices. There are no material costs in existing home sales, yet prices have soared.
I’m with you wondering where this all leads. My son and his wife just paid 7 figures for a house and feel lucky to have “won” the bid. They’re especially frugal (except for buying the house!) and understand their spending patterns very well, so I’m sure they’ll be ok, but it’s absolute crazy right now. And once prices go up, they rarely return to “normal”.
We’re just beginning a remodeling project for our backyard and finally settled on a ~$50k bid, which did not include the grill and associated items like drawers/cabinets. Other bids were $80k+. Some builders wouldn’t even bid unless $100k or more. Same project would have been $20k or less a couple of years ago.
There’s lots of money in circulation right now, some of it due to pent up demand after not spending for a year, and much of it due to the growing wealth gap.
I’m with you wondering where this all leads. My son and his wife just paid 7 figures for a house and feel lucky to have “won” the bid. They’re especially frugal (except for buying the house!) and understand their spending patterns very well, so I’m sure they’ll be ok, but it’s absolute crazy right now. And once prices go up, they rarely return to “normal”.
We’re just beginning a remodeling project for our backyard and finally settled on a ~$50k bid, which did not include the grill and associated items like drawers/cabinets. Other bids were $80k+. Some builders wouldn’t even bid unless $100k or more. Same project would have been $20k or less a couple of years ago.
There’s lots of money in circulation right now, some of it due to pent up demand after not spending for a year, and much of it due to the growing wealth gap.
my house is worth about $780K right now in its current condition (micro-neighborhood supports $700k to $1.1M)- i am fairly certain i can find a $1.25M house that has more total value than what i want to add to my house. It just sucks because I bought the house 4 years ago with the intent to renovate, but I am pretty sure it is foolish at these prices - I was hoping to not have to finance or finance very little, now if I want to do what we want I am look at serious carrying costs.
I feel your pain. Even little projects are crazy. I wanted a generous two car garage/workshop for our vacation place. Pre-Covid it was a $25-$30K project. Today it's a $45 -$50K project. I'm sorry I waited two years ago. I'll just wait another year or two and see what happens.
- Jun 7, 2017
- 10,021
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- 29000
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- Jandy Aquapure 1400
It is not just materials, it is SOMEWHAT materials but it is more supply and demand. Demand for projects is WAY WAY UP. If it was me, I would wait another year or 2. Well, if it was me, I would just do it myself.
A friend just tried to buy a house and offered above asking. She was competing with 25 other people for a "fixer upper" that 2 years ago would be lucky to get $300k and bid up well over $500k. People were making no contingency offers on a 1960s era house in bad shape with septic and well. That is just plain stupid septic alone could be a $75k repair bill. I told her just wait for a year or so when the new owners realize their house is worth 1/2 what they paid and give the keys back to the bank she'll be able to pick it up for $250k.
A friend just tried to buy a house and offered above asking. She was competing with 25 other people for a "fixer upper" that 2 years ago would be lucky to get $300k and bid up well over $500k. People were making no contingency offers on a 1960s era house in bad shape with septic and well. That is just plain stupid septic alone could be a $75k repair bill. I told her just wait for a year or so when the new owners realize their house is worth 1/2 what they paid and give the keys back to the bank she'll be able to pick it up for $250k.
i can do electric, plumbing, carpentry, and finish work (though i do have a full time job) but I can't do framing, i can't pour a foundation or build a basement - plus i need to weigh budget vs my wife not trusting my work (maybe i show up with a fake mustache and an italian accent and she will never know the difference). I was trying to figure out if i can hire someone to do just structure and i can do all the finish work. But any savings there would be offset by a divorce lawyer.
- May 23, 2015
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Maybe park your money in bonds for a year or two and sleep on it (the project). It makes no sense to try to do renovations now as you will be paying a steep premium for the work if you can even get someone to commit to it. My neighbor did a very simple kitchen "update" (not even a remodel) and it has taken months of screaming at the contractor to get people to show up and finish their work. The work has been sloppy and she's had to twist the GC's ear several times to get him to redo the mistakes. Even if you could get someone to commit, they are likely to send out untrained hacks to do the work .... I'd park the money and walk away for right now, it's just not worth the aggravation.
- Jun 7, 2017
- 10,021
- Pool Size
- 29000
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- Plaster
- Chlorine
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- Jandy Aquapure 1400
I would seriously either wait or sell your house and buy a house that has the features you want. What's another year or so? Prices will come down. In lieu of that, you could contract out what you can't do and do the rest yourself. It'll save you at least $200k.
i might do just that
problem is my parents sold their house here and the plan was to do an apartment for them in the basement for the summer while they are not in FL - so there is a bit of pressure to get them of my couch. Ha.
- Jun 7, 2017
- 10,021
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Good call and don't forget, you can't do something right up until the first time you do it. I just put in hardwood floors in my wife's studio. Never in my life did hardwood but was looking at $20k to have it done. Well, $1500 and 2 days later I did it myself and it came out perfect. Even my carpet/hardwood transition came out great! Now we are going to do the formal dining and living rooms in hardwood.
I am with you - i have full confidence in my own ability - i might see what i can do myself - my wife though wants stuff done as quickly as possible
i have an extensive tool set - table saw, chop saw, drill press, biscuit joiner, etc so i can do a lot of stuff with the tools i have - i did the wainscoting as well as electric for the chandalier in my dining alcove (in progress pic):
- May 7, 2014
- 430
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- 29980
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- Vinyl
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- Hayward Aqua Rite (T-15)
At 400k it is over 1k per sq. ft. YIKES!!!
I would run from that price. If you are handy and need it done now, I would contract the parts you can't do and do the parts you can. I just put in my own pool and built a pool house from scratch. I only contracted finishing the concrete and putting the shingles on. I did all the rest myself, I have a full time job that I go to each day...so it can be done. It did take most of last year to do it all, 4 weeks on the pool the rest on the pool house.
I would run from that price. If you are handy and need it done now, I would contract the parts you can't do and do the parts you can. I just put in my own pool and built a pool house from scratch. I only contracted finishing the concrete and putting the shingles on. I did all the rest myself, I have a full time job that I go to each day...so it can be done. It did take most of last year to do it all, 4 weeks on the pool the rest on the pool house.
well that price includes running AC, two new bathrooms, siding and a new roof, but still. I am not sure how self contracting works with my permits, because they want you to supply the contractor and his insurance as part of the permit process. I also have no way of knowing how to select quality crews - for instance i will be pouring a new basement and cutting into the existing basement. I feel like if i can get someone to do the outside of the house and all the structural and just leave me a shell, i could do all the rest
- May 20, 2020
- 1,003
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- 13600
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The price of building materials, lumber especially, is just absurd right now. I just finished building a deck last month, which I had been planning since last fall.
I first made my materials list and looked up pricing between Dec/Jan. At that time, I estimated $1950 for lumber, which was already higher than "average".
By March, when I kicked prepping into high gear, that same lumber was up to $2450.
By the time I finished purchasing everything in April, I had spent $3050 on that same lumber. That's a 56% price increase in 5 months.
Case Study, an 8ft 2x10 at Menards-
January - 11.98; March - 18.77; Today - 24.69
When I chatted with our inspector, who previously owned a construction company, he shared how much builders are struggling with pricing. They can bid a project, but have no clue how much prices will have increased by the time they start and it's ultimately done. (If you do end up moving forward with your project, try to get some protection for cost overruns)
Add to that increased demand for services and the natural price inflation that goes along with that, and it's just an awful time to be building anything.
I first made my materials list and looked up pricing between Dec/Jan. At that time, I estimated $1950 for lumber, which was already higher than "average".
By March, when I kicked prepping into high gear, that same lumber was up to $2450.
By the time I finished purchasing everything in April, I had spent $3050 on that same lumber. That's a 56% price increase in 5 months.
Case Study, an 8ft 2x10 at Menards-
January - 11.98; March - 18.77; Today - 24.69
When I chatted with our inspector, who previously owned a construction company, he shared how much builders are struggling with pricing. They can bid a project, but have no clue how much prices will have increased by the time they start and it's ultimately done. (If you do end up moving forward with your project, try to get some protection for cost overruns)
Add to that increased demand for services and the natural price inflation that goes along with that, and it's just an awful time to be building anything.