Wednesday, 06 March 2024 / Published in Base4

Developers | Are Cheaper Construction Costs Ahead?

Reading Time: 4 minutes

Builders in the housing market are currently facing numerous challenges. High-interest rates and high construction costs have decreased builder confidence. With rates and costs at an all-time high, you may be thinking it’s not the right time to move forward with new development deals, but that may be a mistake! Read on to find out.

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The top 3 builder concerns for 2024 are, not surprisingly, high-interest rates, buyer expectations of declining prices, and cost/availability of labor.

According to the NAHB/Wells Fargo Housing Market Index survey, it is predicted that some of the significant challenges faced by builders in 2023 will continue to persist in the year 2024. Here are the key problems that have greatly affected the housing market:

High-interest rates were a major concern in 2023, and 77% of builders anticipate it to continue being a problem in 2024. The good news, inflationary concerns have dropped considerably. This is good news for an issue that has been at the forefront for quite some time!

What Can Be Done?

When interest rates begin to drop, and builders’ pipelines slow, development costs should inevitably drop. So the question is: WHO WILL BE READY TO TAKE ADVANTAGE?!

Those developers preparing deals and getting permits in hand now are the ones who will take advantage of interest rate drops when they do come. Many of our clients are getting permit plans ready now with this sole purpose in mind.

When facing the current market challenges, working with a design firm that truly understands these obstacles is crucial. It is fundamental for builders to remain proactive and find effective solutions to address these ongoing issues to ensure a successful and resilient housing market in 2024.

BASE4 Is Here to Help!

We help developers, general contractors, and factories find better ways to build through innovative technology, forward-thinking design, and offsite manufacturing. Our primary focus is providing top-tier services to our clients to ensure seamless collaboration and unparalleled results.

The BASE4 team has worked around the globe, providing a wide range of expertise in quality standards, specifications, and international best practices for design.
Our team works with developers and general contractors to rethink traditional building methods by infusing innovative technology, forward-thinking design, and offsite manufacturing principles to build projects CHEAPER and FASTER!