Is there such a thing as the perfect time to build? This is the million dollar question and I’d like to give some examples of when building can be more stressful and costly, then maybe you can decide for yourself. But before I do, there’s something I’d like to show you.
There are three elements to a building contract:
- Time
- Cost
- Quality
What if I said you can only have 2 of them but not all 3? If you want time and you want quality, the cost will blow out. If you want quality and you are concerned about cost, then the time will be longer.
So okay, you are wondering, how does this affect me when deciding the right time? Time can be more costly than you may initially think. You may have to rent whilst building your next home or if not you will lose the capability of leasing the property if you are thinking of retaining your existing property. Also, what is the cost of your mortgage? Calculate how much the mortgage is going to cost throughout the construction period. You might just find the more expensive builder may ultimately be the cheaper builder. Plus you get a better quality job and reduce stress on yourself.
During a building boom resources become stretched as labour is in higher demand. Build times become longer and quality generally suffers as a result. In downturn it’s the opposite; trades are more readily available, quality is of a lot higher standard and build times are more predictable. This all translates as less stress for you. This also impacts on the property market and the price of land is going to rise and fall accordingly.
When is the best time to pick up a potential block, or if you already own a block with the intention of building, when is the best time to begin that build? If the market goes down, am I going to sell? If the answer is no then you can take the property value out of the equation.
ABS Building Approvals
As you can see in the graph above, building trends are fluctuating all the time. You notice the peaks and troughs are not that far apart? Yes, but this is different; remember the GFC when the world was about to implode? Did it implode?
Of course there are no guarantees in life, beside death and taxes, but what I can guarantee is that signing a building contract in a boom is not going to get you the best deal and realistically this will bring its own set of stresses. I hope you have given a couple of ideas that you may not have thought of.
At Maughan Building we are a Perth Modern home builder including many different styles and designs such as Hampton Style Homes Designs, Tuscan Style Home Designs, Federation Style homes Designs and many other contemporary home designs.
Good luck and I’m Rob the Builder