The building boom

My book has not touched on the pitfalls that can be around once you have got your home deposit, and your building loan. In my book I do speak of having more cash and less borrowings to be on the safe side. However, some "recent events" (those dreaded fires in the south, cyclone damage in the north, the first home buyers entering the market, together with low interest rates being offered at the moment), have caused extra demand on building supplies due to the necessity to rebuild. Any bubble in any industry is good, though, unfortunately tends to push the industry off balance.

Recently the news has surged relating to the home builders construction boom. For those considering engaging a builder there are some considerations and further questions to be answered, like:

• Is the material readily available for the project.
• The supply and demand on building materials may affect pricing of the job, and the ultimate cost of the finished project.
• The subsequent shortage of what is needed to keep the workers employed continuously, together with the rising costs of materials, may not end well for all concerned.

Nothing would be more devastating to a home owner to find their builder becomes insolvent. One other idea could be to pre-purchase the materials before commencing the project!