Sep 14, 2020 | Dallas Morning News
Buyers shopping for new homes may be in for some sticker shock. But the increase in prices of new houses is being offset by record low mortgage rates.
Homebuilders hit with higher costs are passing them along to buyers. Nationwide, more 56% of new home communities raised their prices in July.
And in the Dallas area, more than 60% of new housing communities were increasing their prices, according to a new report by Meyers Research, which tracks thousands of new home projects across the country.
“Builders are raising prices for two reasons,” Ali Wolf, the chief economist with Meyers Research, said in the new report. "For starters, costs are going up.
“Lumber prices are up over 100% since mid-April, and that’s putting pressure on margins,” she said. “On top of that, builders are raising prices to temper demand.”
A shortage of lots in some markets and rising land costs are causing builders to more cautious, Wolf said.
“Builders need to be careful to not sell through all of their lots too quickly, so many will slow sales intentionally,” she said. “Today’s low mortgage rates allow builders to raise prices without crushing demand.”
A surge in demand for North Texas homes caused by the record low mortgage rates is causing builders to ramp up production.
The price tags are going up, too.