For many families, selecting and navigating a move into a new home is the fulfillment of a dream. But for others, moving into their dream home would mean a house designed specifically for them, custom built on their own selected lot.
This latter group is now facing a growing problem – a shortage of desirable lots on which to build their custom-designed home.
Finding suitable lots remains a top concern among homebuilders. Sixty-two percent of builders reported that the overall supply of developed lots in their areas was low to very low, according to a survey conducted this month by the National Association of Home Builders.
That marks the largest percentage of builders who have called lot shortages a severe problem since NAHB began tracking it in 1997.
The problem has only grown in recent years. In September 2012, the percentage of builders who called lot shortages a problem was at 43 percent – compared to 62 percent today.
“The continued low supply of developed lots is a hindrance to the housing recovery that is still quite modest by most standards,” according to a post on NAHB’s Eye on Housing blog as reported by the National Association of Realtors.
“A shortage of buildable lots, especially in the most desirable locations, translates into higher prices, as 38 percent of home builders said the price of developed ‘A’ lots was somewhat higher than it was a year ago, and 32 percent said the price was substantially higher.”
Q: Where are property taxes the highest?
A: The Northeast and Midwest, in general, have the highest property tax burdens when compared with the West and Southwest, according to a new analysis by the Lincoln Institute of Land Policy.
The agency recently released its annual 50-state property tax comparison study, an analysis of effective property tax rates in each state. “The property tax remains the foundation of sound municipal fiscal health,” says George W. McCarthy, president of the Lincoln Institute.
Homeowners in Bridgeport, Connecticut, are paying the highest property taxes on homes worth $150,000 to $300,000, followed by Detroit; Aurora, Illinois; Newark, New Jersey; and Milwaukee.
On the other hand, cities with the lowest effective residential property tax rates are Denver; Birmingham, Alabama; Washington, D.C.; Honolulu and Boston.
Q: Is this a good time to buy a home?
A: That depends on how key factors shape up in the near future. One economist put it this way:
“The wild card for the market may be what happens with mortgage rates in the next few months. Low mortgage rates have helped to keep homebuyer affordability high in the first quarter of this year, but housing markets will likely see an increase in interest rates for the remainder of year,” Freddie Mac economists note.
Q: What suburban areas offer the best opportunities for homebuyers?
A: Niche recently ranked America’s suburbs, factoring in home values, property taxes, housing costs and age of new homebuyers. The following five suburbs were found to have strong housing markets where property taxes and housing costs are most in line with value:
1. West Conshohocken in Montgomery County, Pennsylvania: Median home value: $315,700.
2. Waukee in Dallas County, Iowa: Median home value: $188,600.
3. Centerton in Benton County, Arkansas: Median home value: $133,400.
4. Chapin in Lexington County, South Carolina: Median home value: $130,500.
5. Fishers in Hamilton County, Indiana: Median home value: $209,700.
Q: What are some negative factors about buying a warranty program for your home?
A: For starters, you have no choice in selecting a service provider. Also, there’s a good chance that the cost of the warranty will be more than the cost of the provided service. That’s how the warranty companies make a profit.
If your home is fairly new – less than five years old – you probably will not have a need to file a claim. Systems in newer homes seldom have problems.