Latest news with #CostofConstructionSurvey
USA Today
03-04-2025
- Business
- USA Today
A close look at the cost of building a new home
A close look at the cost of building a new home Show Caption Hide Caption Baby Boomers buying more homes than Millennials Move over, Millennials — Baby Boomers are now leading the way in the housing market. According to the National Association of Realtors, Americans aged 60 to 78 now make up 42% of homebuyers, compared to just 29% for Millennials — despite Millennials being the country's largest generation. Fox - 5 NY If you're in the market for a new home, you might wonder about the factors contributing to the home's total cost. The National Association of Home Builders recently published a Cost of Construction Survey, which details the various costs of building a typical new single-family home. Many of the results show that the percentage contribution of each component has remained relatively consistent in recent years. According to the 2024 survey of home builders, the biggest single component of a new home's total sales price is construction costs, which accounts for around 64.4%. For example, the sales price of a $665,298 house would likely factor in construction costs of approximately $428,215, or 64.4%. Still nervous about homebuying in 2025? You're not alone: What buyers said in new survey Survey respondents broke down construction costs into eight major construction stages: Interior finishes (e.g., cabinets, drywall, flooring): 24.1% Major system rough-ins (e.g. electrical, HVAC, plumbing): 19.2% Framing: 16.6% Exterior finishes (e.g., roofing, windows): 13.4% Foundations: 10.5% Site work (e.g., architecture, building/permit/impact fees): 7.6% Final steps (e.g., driveway, landscaping): 6.5% Other costs: 2.1% The share of construction costs to the total price of a new home is the highest since NAHB first produced the survey in 1998. Some of the factors that contribute to the construction costs are the ongoing skilled labor shortages and building material price increases. The average single-family home size in the 2024 survey was 2,647 square feet of finished floor space, an increase of 86 square feet from 2022. From 2015 to 2022, the average square footage of a home trended downward. Constructing homes with smaller square footage in recent years is a response by builders to meet the current housing affordability challenges buyers face. Though building practices and the cost of labor, land and materials can vary widely across the country, these national averages provide an overall snapshot for the building industry. Javan Yoder is 2025 president of the Building Industry Association of Stark & East Central Ohio
Yahoo
16-02-2025
- Business
- Yahoo
Classic housing types like 3-flats, triple-decker and painted ladies could help solve the US housing crisis
In Chicago, they're called 3-flats. In Boston, they're called triple deckers. New York City folks refer to them as brownstones. And in San Francisco, they're known as painted ladies. Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 5 of the easiest ways you can catch up (and fast) Home prices in America could fly through the roof in 2025 — here's the big reason why and how to take full advantage (with as little as $10) We're talking about triplexes, or homes with three separate housing units stacked on top of one another under one roof. And according to Stewart Hicks, an associate professor at the University of Illinois at Chicago, 'these buildings might be the key to solving the mounting housing challenges that we're facing in cities today." Yet cities are facing big challenges in having these buildings constructed. And it's only making the affordable housing crisis even worse. Triplexes are commonly found in densely populated cities. But building more of them may not be in the cards anytime soon. And that's a shame. As Hicks explains in a video posted to his channel, "In many cases, these structures offer on-ramps for homeownership and building equity and wealth. They can encourage and develop strong neighborhoods, and maybe even familial bonds if generations remain living together." "Buying a two-flat didn't just mean more breathing room and more pleasant living conditions. They were always intended as wealth-building investments. Rental income could cover the mortgage and provide a degree of economic security," says the Chicago Architecture Center. Yet dated zoning codes commonly get in the way of increasing the number of these homes in cities by disallowing anything more than single-family homes on a single lot in a residential area. There's also what Hicks calls the "economics of construction" that's become a barrier. The National Association of Home Builders recently said that broad inflation in the global economy since 2022 — particularly in building material prices — has driven up the cost to construct a home. Other factors increasing building material prices are disruptions in supply chains and growing demand for sustainable and green options. Construction costs accounted for 64.4% of the average price of a new home in 2024 compared to 60.8% in 2022, according to NAHB's most recent Cost of Construction Survey. Hicks says that a three-unit home could easily cost over $1 million to build in big cities. And in today's mortgage rate environment, those who buy those homes as investments will need to charge top market rates to cover their costs. That's not going to address the issue of affordable housing, though. Read more: I make $60,000/year, the only earner, and I worry about my family if I pass away — here's how 5 minutes can get you 7-figure coverage starting at just $2/day In a recent Pew Research Center survey, 69% of Americans said they were "very concerned" about the cost of housing. And a 2024 Center American Progress survey found that 76% of people feel similarly. That data also found that 72% of urban residents feel housing affordability is getting worse. In a 2024 report, the Brookings Institution estimated that the U.S. housing market was short 4.9 million housing units in 2023 relative to the mid-2000s. And as of 2023, roughly half of renter households were housing cost-burdened, per the 2023 American Community Survey — meaning, they were spending more than 30% of their income on housing. That amounts to nearly 21 million households in total. Triple-unit houses can help solve the problem by allowing for more individual units within the same lot — provided they can be built more affordably. To that end, though, the Pathways to Removing Obstacles to Housing program could help. It's a program administered by the U.S. Department of Housing and Urban Development that provides funding and incentives to state and local governments for facilitating affordable housing. Specifically, the program targets communities that are actively taking steps to remove affordable housing barriers such as outdated zoning laws and inefficient procedures. Not only can triplexes help address the U.S. housing crisis, but they could also promote multigenerational living, which is a beneficial thing itself. Among adults in multigenerational households, 40% point to financial relief as a perk, according to Pew Research Center. And for 33%, this arrangement helps address the need for caregiving. Critics of triplexes might argue that they're not only eyesores, but that they exacerbate density issues in already packed cities and have the potential to de-value nearby properties. In the wrong context, these buildings could cause more harm than good. They can be easily converted into luxurious single-family homes or they may be bought for cheap and demolished since land values are high. "In these cases then instead of just gently encouraging more density like we want, it just serves to increase land values until longtime residents are forced out and it ends up solving nothing in the end," says Hicks. But all told, there's much to be gained by removing barriers to triplex construction. As Hicks says, 'Folks are coming to recognize just how important these buildings are to their cities and the people who live in them.' Is your savings account struggling to keep up with soaring grocery prices? Here's how 2 minutes can earn you 9X the US national average — with no monthly fees One dozen eggs in America now costs $4.15 — and $14.35 for a pound of sirloin steak. Both record highs. 3 simple ways to protect your wealth in 2025 Jamie Dimon issues a warning about the US stock market — says prices are 'kind of inflated.' Crashproof your portfolio with these 3 rock-solid strategies This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
