Des Moines Real Estate Blog

Your Economist of Choice, Your Realtor of Choice

  • Adam Van Lin, Realtor
    Burnett Realty
    10200 Hickman Rd. #100
    Clive, Iowa 50325
    Cell 515.344.1068
    Fax 515.331.3401
    Licensed in Iowa

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Cost of New Construction Ticks Lower

Posted by adamvanlin on September 26, 2011

The cost builders incur to build new houses is tracked by the BLS’ Residential Construction PPI (Index).  The more expensive it is to build, the less likely builders are to take out new permits and begin construction.  As we can see by the chart below, the cost has risen sharply over the past 2 years but this month is actually dropped (slightly).  It is still elevated though and the cost to build a new home is about 6.5% higher in August 2011 compared to August 2010.  Fewer houses being built means less supply, which is probably a good thing for prices right now.  The builders in the Des Moines area that I talk to all say the same thing.  People are only buying homes that are already built, so there are no “pre-orders” being placed like in years past, which has slowed the building of new homes in our area.

Interested in new construction?  Give me a call.  Des Moines has several options available if you would like a custom-built, new home.


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