Construction costs rise

It's getting more expensive to build a home. El Dorado County recently adopted regulations that will impose a “traffic mitigation fee” on every home built in the county. This fee is in addition to the following building and impact fees already in place:

Building Permit fee
State Traffic Fee
Fire Protection Fee
Environmental Management Fee
New Septic Fee
Site Addressing Fee
Office of Education Fee
Plan Checker Fee
And now “county traffic mitigation fee.

The new and in addition to…….. “Traffic Mitigation Fee” (TMF) isn’t based upon the number of cars, people, bedrooms or square footage of a home, it is based upon the home’s location. So if you have a lot near highway 50, say in El Dorado Hills and want to build on it, the additional cost of the TMF will be $29,000. In Cameron Park the TMF cost will be $37,000. But if you are building in Cool or Georgetown the cost will only be an additional $13,500.

So, the building permit fees alone on an average size 2,500 square foot house in El Dorado Hills will be a whopping $78,500. But wait there more>>>>>>

According to research from the Bureau of Labor Statistics and the Associated General Contractors of America. The latest data shows an eight percent jump in building materials costs during the year-over-year period ended in July. Prices for copper and brass surged a whopping 88 percent over the same time span. Costs rose 27 percent for gypsum boards, 20 percent for plastics, 11 percent for cement and six percent for sheet metal siding.

So with increased building costs and county fees how is the price of new housing going to come down? It won’t. There will be fewer new homes built. You can’t sell a product below what it cost to make and stay in business so I suspect builders will pass up building opportunities in El Dorado County and take another look at Yuba, Sutter, Sacramento and Placer.