I know we're getting off-topic from my OP but that's ridiculous. If the price doesn't include land or permits, how do other cities manage to sell houses for under 500K and not lose money?
I link to back up my claim:
https://www.vancouverhome.builders/how-much-cost-to-build-house/The average cost to build a house can range from as low as an average of $200,000 to $350,000 for a 1000 square foot home to double, triple or even quadruple that amount. An average sized 2500 square foot house, for example, will cost anywhere between $500,000 and $875,000 to build based on these price considerations. Higher end finishes will increase the price dramatically.
The house on my block is at least 2500 sq ft.
Note that someone building an entire neighborhood of similar homes would have significantly lower costs per home.
What is it about labour and materials that's so expensive here?
I heard that 25% of cost of a home are various permits and inspections. It is not clear how much of that 25% is useless red tape and how much is necessary (i.e. inspecting electric work). Labour is also costly because you need local skilled workers (25-50/hour). In countries with cheaper workers the labour would be cheaper.
That said, buildings are a depreciating asset like a car. A new one costs 500K but a 10 year old building is only worth 300K and a 40 year old one is 30K.
In markets with cheaper housing most of the sale will be for old homes.
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