Skyrocketing Building Costs , Could Stall Residential and , Commercial Development.
'Newsweek' reports that homebuilding costs in San Jose, California, have reached record highs, reflecting a more widespread problem in the United States.
According to a new report, builders in San Jose are facing high interest rates amid skyrocketing costs for both materials and labor.
According to a new report, builders in San Jose are facing high interest rates amid skyrocketing costs for both materials and labor.
In San Jose, the cost of building one unit of affordable housing jumped up 24% in the past year, climbing from $757,900 to $938,700.
Adrian Pedraza, a real estate broker and owner of The California Homebuyer, said that San Jose's issues are the result of scarce land, high costs and "bureaucratic roadblocks." .
Adrian Pedraza, a real estate broker and owner of The California Homebuyer, said that San Jose's issues are the result of scarce land, high costs and "bureaucratic roadblocks." .
It's become a huge challenge to build affordable housing there and in similar tech hubs.
It's a perfect storm for astronomical pricing, Adrian Pedraza, real estate broker and owner of The California Homebuyer, via 'Newsweek'.
It's become a huge challenge to build affordable housing there and in similar tech hubs.
It's a perfect storm for astronomical pricing, Adrian Pedraza, real estate broker and owner of The California Homebuyer, via 'Newsweek'.
'Newsweek' reports that the situation in San Jose mirrors issues faced by homebuilders across the U.S. According to real estate consultant John Andrews, California and the Southwest have seen the largest price hikes due to unique environmental factors.
Insurance for construction is more costly now, especially in states like CA that have experiences a disproportionate number of natural disasters in recent years, especially wildfires, John Andrews, commercial real estate consultant, via 'Newsweek'.
Insurance for construction is more costly now, especially in states like CA that have experiences a disproportionate number of natural disasters in recent years, especially wildfires, John Andrews, commercial real estate consultant, via 'Newsweek'.
Experts have expressed concerns that high building costs will lead to a loss of housing and commercial development in the city.
When costs are too high to justify potential returns, projects will be shelved.
This could lead to a slowdown in residential construction when the long-term trend suggests that the market needs the opposite, Danielle Hale, Realtor.com chief economist, via 'Newsweek'
