Why New Homes Are A Tough Sell In Greater Phoenix

During last year the monthly sales of new homes were about 600-800 per month and they dipped down to as low as a few hundred per moth in the first quarter of 2010.  

How can new builders even compete with below replacement resale homes that are just a year or a few years old? They can't.  The only way to get close is by cutting costs and the only way to do that is by building home that cost less to build and in turn have less to offer and are of more questionable construction. 

This is especially true considering many building materials have gone up up to 50% just this year.  

I know people who work in that industry and the overall feedback is that builders are skimping in all the places they can.  Less interior wall or more sand in the stucco.  

AZCentral reports, "The Open Series launch (by KB homes), which follows a relatively recent homebuilder trend of constructing simpler, more utilitarian homes with low prices and high energy-efficiency..."

Resale homes are selling at up to half of replacement cost.  That means it would cost you twice as much to rebuild the home then what your paying for it and in world where demand for materials is growing.

Many builders do a fine job building homes with top quality materials and execution, but be careful when shopping for new home.