While some economists continue to lament that one of the longest recessions in U.S. history persists, signs of recovery and a return to economic vitality are surely coming around. Despite a lingering concern for the future, those looking for the log home of a lifetime can take heart. Somewhat ironically, there may
never be a better time to buy.
The reasons for this sudden surge of opportunity are varied; however, the most dramatic lies in the price of money, the funding that makes a log home purchase possible for most potential buyers. “Mortgage interest rates are at an all-time low,” explains Tom Vesce, owner of Original Log Cabin Homes. “We are busy, and the pace continues to pick up. We are actually adding a third log cabin mill, hiring people for all departments, and acquiring new locations.”
True enough, long-term mortgage rates have declined to well below 4 percent and have hovered there for some time without any indication of a major shift upward anytime soon. “We all know that rates will be climbing one of these days,” adds Jock Davidson of Daniel Boone Log Homes, “and land prices are hovering around 1970s prices, but they won’t stay there forever. All components of building a new home continue to experience downward pressure. Builders and contractors are willing to compromise on their pricing to stay in business and keep their skilled workers working.”
According to Marty Pone, director of client fulfillment for Town & Country Cedar Homes, the prices of the properties themselves have become more favorable, not only with existing log homes but also with building sites that once may have been priced beyond the reach of the average consumer.
“Properties are cheaper these days,” comments Pone. “People have been looking at foreclosures a lot, but if they quit focusing solely on foreclosures they can discover opportunities to build and own their own log home rather than purchasing someone else’s dream. Property is property, and there are gorgeous ones available at $600,000 today that were priced at $1 million or more a few years ago. So, now is an excellent time to look at building and owning a log home.”
Davidson agrees that buying or building a new log home today assures the consumer that they are not signing on with someone else’s problem or acquiring someone else’s dream by default. “You can design and build the home of your dreams,” he asserts, “and if you have been dreaming of a new log home, the conditions couldn’t be better to stop dreaming and start doing. At the same time, there are no new pitfalls that I am aware of, although the same attention should be paid to quality, price, and service from all suppliers.”
Like other companies in any line of business, the rush to remain viable during an economic downturn has caused log home companies to reassess their operations, consolidate, and develop new strategies for a changing marketplace. Such changes actually enhance the value proposition for today’s log home buyer.
“When times are good, you pay more attention to the fulfillment end of the process,” explains Pone, “but everybody in this industry is like us, leaner and meaner. Our operational savings are reflected in lower costs and better value for the buyer. We have asked what we can do better and made changes, and other companies have done the same. Now, people are getting more for their money and looking closely at what they can get for their dollar. People that we tailor our work to are not just asking about the price of the structure but what else we can do for them. Any company could have shaved quality and cost to bring the price down, but those are the companies that are not around anymore.”
The combination of low interest rates and property values, along with the efficiencies gained in log home companies and among contractors and builders, is bolstered by an emerging willingness among lenders to extend credit. Although the requirements for loan approval have been strengthened, mortgage originators point out that qualified log home borrowers are finding the bargains of a lifetime.
As overall economic conditions improve, it is a safe bet that interest rates and general costs will increase. Hesitation may result in the inability to act, or at least to act in the most favorable value-related circumstances. “The longer you wait, the more the project costs will increase no matter what type of home you build,” offers Vesce. “Further, there is less capacity in the log home industry due to the shrinkage of the marketplace. As demand continues to pick up, the law of supply and demand will take
over.”
Those who look to the log home market today can put the pieces together, achieving value, quality and, best of all, the home they want—winning big in every way.