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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Jim McMannis who wrote (58856)	8/4/2006 10:11:36 AM
From: Don Earl	Respond to of 306849

RE: "Not to mention labor." From what I've seen, labor isn't much of a factor over the past few years. Construction outfits may have gotten greedier, but any increases along those lines is from the top down rather than the bottom up. The biggest jump I've seen in that area is HVAC, where most outfits are charging about 7 grand to install 3 grand worth of equipment. That's about double what it was a few years ago, but even so, it accounts for maybe 1-2% of the total construction costs on a median priced home. The biggest bite is in materials which has pushed up the cost to build a median sized home by about fifty grand in the past 3 years. In other words, your typical 1500-1800 SF rambler that sold for $200K three years ago is now $250K on materials alone. RE: inflation Yeah, the "pros" have a funny way of measuring inflation. As close as I can tell, it's based solely on the exchange rate of the US dollar, with most of the weight being against the Japanese yen. When the dollar drops, rates increase to make bond yields more attractive. There doesn't seem to be any need to "curb inflation" when the yen is around 120 to the buck. Go figure.