Episode 204: Buyer's Guide

Stuck on the question, “Should I buy now or wait?” We unpack that decision with a practical lens: real construction costs, builder timelines, rate dynamics, and the quiet power of buyer leverage. Zac Daniel of Victorian Finance and Luke Barksdale of Viz3D Space team up to explain why emotions and headlines often push buyers off course—and how a simple, strategic plan brings you back to solid ground.

We break down the post-2021 landscape, where higher rates coexist with better negotiating power, fewer bidding wars, and meaningful concessions. You’ll learn how production builders protect comps while offering strong incentives, why a seller-funded rate buydown often beats a price cut for monthly affordability, and how locking costs and builder capacity today can matter more than chasing a theoretical future rate. We also tackle the hidden cost of waiting: from lost equity and rising materials to the reality that top builders’ calendars fill fast the moment demand rebounds.

Beyond the numbers, we focus on readiness. Are you designing a forever home or your next step? Which upgrades must happen during the build to avoid paying remodel premiums later? How can renting, bridge timing, or a starter home fit into a bigger equity strategy? To keep it simple, we share a three-question framework that helps any buyer decide with clarity: Will I be okay if rates don’t change, am I set to refinance if they do, and what does waiting actually cost me?

If you want to replace guesswork with a plan, this conversation gives you the tools: clear timelines, practical financing moves, and a team-first approach to design and construction. Subscribe for more Constructive Conversations, share with a friend who’s house-hunting, and leave a review with your biggest question—what’s the one thing you’re still weighing before you move?

Transcript

Framing The Big Buyer Question

SPEAKER_01 0:06

Hey everybody, welcome back to Constructive Conversations. I'm Zach Daniel with Victorian Finance.

SPEAKER_00 0:12

And I'm Luke Markstill with Viz3D Space.

Emotions Versus Strategy

SPEAKER_01 0:15

So today's episode is just for buyers, not sellers, investors, builders, just buyers. Because the most common question I hear right now isn't about rate or credit or inventory. It's the one question, should I wait or should I buy? And the problem is most people are asking that question emotionally instead of strategically. So today we're going to slow it down and talk through how buyers should actually be thinking about the market.

SPEAKER_00 0:42

Yeah, and from a construction and like real estate standpoint, I really like this conversation because, you know, waiting is not wrong. People think that it is. It's really not. But if you're waiting without a plan, uh it that that's that's wrong. Buyers need clarity, you know, not a lot of pressure.

SPEAKER_01 1:00

Yeah. So, you know, let's just talk real quick about why buyers feel that frozen mentality. Why are they waiting?

SPEAKER_00 1:08

Yeah, I mean, so fear of is this the right time? Should I jump in the market right now? Uh I've heard rates are gonna drop, you know, maybe I should wait. I think you're getting a lot of that right now. Um we have people coming in, designing houses, getting bids that are weighing the options. Yeah. And a lot of times it's not that where do I need to be? Conversation. It's where's the market at conversation. And that doesn't really necessarily matter to your personal situation quite as much as where you stand.

Comparing Today To 2020–2021

SPEAKER_01 1:50

You're right. Because most people are still trying to live in a comparison, they want to compare today versus 2020, 2021, where interest rates were, you know, at an all-time low.

SPEAKER_00 2:05

Yeah.

SPEAKER_01 2:05

And yeah, they are higher right now, but buyers also have more leverage right now than they did back then. And there's not as much competition because I don't know about you. I I bought a house in 2021. Right. And I being a mortgage lender, I dealt with plenty of buyers who I have pre-approved who sat on the market for sometimes six months because every offer that they put in, they did not get it. They were outbid. Right. They, you know, everyone was going over asking prize. You had to write little letters to try to sway sellers into going with you. And I'm going$100,000 over your asking prize. Please let me have it.

Costs To Build And Inflation Reality

SPEAKER_00 2:54

I actually had one of those deals where uh a buyer we had wrote a letter to the seller, and it actually won us the offer on the whole thing, but that was a wild time. I mean, it really was, and you just don't see that right now. Um, but people are anchoring themselves and like this past prices. Used to, when we first started designing houses for people, we would tell them it's a hundred dollars a square foot. That is long gone. Like, never gonna see it again, kind of gone.

SPEAKER_01 3:27

Yeah, I mean, just where inflation is and what it actually costs to buy the supplies, uh, you can't you can't build a house for that.

SPEAKER_00 3:35

No, you absolutely can't. I mean, I would say even on like for custom homes, now track homes are a little bit different because they can buy block stuff, but like on custom stuff, you're you're like a 220, 225 on like the lower end. And then we've seen people, I mean, custom, you can kind of spin what you want, right? And you can see it up in like the 400s per square foot pretty easily. It's not it's not a big stretch like people think it is. It's pretty easy numbers to hit, yeah.

SPEAKER_01 4:05

Um, also, you know, like briefly talked about headlines uh really driving people's decisions. It's very emotional. But where headlines come in, and you know, I buyers will ask me all the time, too. Well, you know, should we wait? You know, should I wait to refinance? You know, markets are supposed to drop. And well, yeah, it's true. The headlines are predicting that rates do drop, but if you're looking to build something right now, now is the time to start. Because if we've learned anything from 2020, 2021, when those rates dropped, the market was flooded with competition and prices went up.

SPEAKER_00 4:54

Yeah.

SPEAKER_01 4:54

So if we start seeing rates drop, there's been so much pent-up buyer's anxiety of wanting to get into the market, they're gonna jump as soon as those rates start.

Builder Capacity And Timing Windows

SPEAKER_00 5:08

Oh, and that's on dropping. That's that's buying houses that are pre-built, that's construction stuff, too. I mean, builders only have so much backlog. Yeah, like you can only do so much in a year, and so what's gonna happen is those slots are gonna get eat up. And so your your great builders are gonna go first, your good builders are gonna go second, and then in a hot market where where people are just like jumping in, if you've got a builder who can start tomorrow in a hot market, they're either massive and have multiple project managers, or they're not a good or great builder. Like, and and right now, everybody's got availability. Yeah, like everybody has got some form of availability. We're just now seeing some of our business partners uh in uh in the building industry, like just now seeing some of them go, okay, you know, it's gonna be a year or so before I can touch anything, but that's just in the past couple weeks, really, you know.

Locking Costs Now, Dating The Rate

SPEAKER_01 6:06

Yeah, it's it's true. And I mean, jumping on it right now uh and kind of talking about building, you know, you're you're essentially kind of locking in that contract and locking in those costs now. Yeah. Um and then you know, the rate can change later.

unknown 6:26

Yeah.

SPEAKER_01 6:27

But you're that way you're you're not fighting with the competition now. You're uh the cute little saying that was going around for years now is marry the house, date the rate. Right. But that is absolutely true. And right now is really the time to take advantage of that because the market will be falling. Rates are lower right now than they've been since 2022.

SPEAKER_00 6:54

Right.

SPEAKER_01 6:54

And so let's stop sitting on the sideline and really move forward with that before it becomes too out of control and the prices go up.

What Waiting Actually Costs

SPEAKER_00 7:05

Yeah, I you know, it it's strategic for everybody and everybody's situation is a little bit different, but ultimately right now is a good time to get going in your process. I mean, a build is 10 to 12 months, guys. You're not you're not finding the rate today and going, oh, I'm gonna lock that in, unless, of course, you're doing like a one-time close. But in most cases, you are I'm you know, I'm gonna start this build process and there's either a refi point or I'm I'm gonna close and flip the permanent at the end of this. So if you've determined, if you've done the due diligence and you determine that like right now is a good time, the rates falling four or five months from now isn't gonna change the fact that right now is a good time for you to build.

SPEAKER_01 7:55

That's right, you know, that's right. And um so one of the things that we really want to talk about was what does it really cost if you do wait?

SPEAKER_00 8:06

Right. Um what are you what are the unseen implications of cost that you may catch?

SPEAKER_01 8:11

Yeah, and so you know, waiting isn't a free uh thing to do, and it's really the question you need to ask yourself, and again, it it's an emotional question. What is it that you're waiting for?

SPEAKER_00 8:24

Right.

SPEAKER_01 8:25

Are you waiting for rates to drop? Well, we've just said if rates drop, prices tend to go up. And so are you waiting for you to be more set financially? And if that's really what you're waiting for, then that is a good thing to add, you know.

Build Your Team And Set Goals

SPEAKER_00 8:43

There's like a legitimate concern there, but it's not just an arbitrary, okay, one day I'm gonna be ready financially. Like, set the goal, right? Like you gotta set the goal, you gotta have the conversation, right? If you have no concept of what you will build, what it will cost, if you if you have no idea and you're even thinking about doing this stuff, having these conversations, getting it out in the open, having the uncomfortable financial conversations allows you to set the goal of like, okay, I'm not ready today, but on this day I will be because I hit these financial markers. Yep. And that that only happens through that team thing we talked about, you know, like finding your builder, designer, and your uh lender and and kind of figuring that out. Nobody said it had to be, I contacted them and it all went through, and I pulled the trigger on the build the next day. That's not necessarily how it works in most cases. A lot of times, these are long drawn-out relationships of, hey, we hit this roadblock, but we developed a plan to get around it, and I work with my lender to get it done. And then now I'm back on track for the build, hit this other roadblock, work my builder to get around that. It's a lot of that, yeah.

Renting, Equity, And Opportunity Cost

SPEAKER_01 9:57

No, it is. I I had a buyer contact me today. Um actually, you know what, I think it's the one that you sent me. Um, but they said that they wanted to plan on building within the next six months, right?

SPEAKER_00 10:12

Yep.

SPEAKER_01 10:13

And I said it's a great time to sit down and have that conversation because they they wanted to go ahead and create their budget and create their financial picture so that they can be ready and they want to just start those conversations. And and that's very important to do, and something we've talked a lot about.

SPEAKER_00 10:31

Yeah, absolutely. You know, stuff that if you're if you're like renting a house, waiting to build, you're just kind of throwing money in into this pit with rent, and so you're losing there. If you own a house and you're looking to sell and and start building equity in this other home, right, you're losing out on the potential equity over here.

SPEAKER_01 11:00

Yeah, and that's not to say that you know renting is 100% bad. I mean, certain circumstances where renting is the best option to do.

SPEAKER_00 11:12

But it could be part of that financial plan we were talking about.

Emotional Readiness And Lifestyle Fit

SPEAKER_01 11:15

Absolutely. You know, I'm working with this guy who wants to build a new construction home. He owns a home, he has equity in the home, and just where the pieces have fallen, he's gonna need to sell that home in order to obtain all that equity needed. Renting is gonna be his best option through construction. And, you know, so everything is really very situational. But if you were just renting and want to sit on the sidelines and say, I'm gonna wait, you need to decide what it is you're waiting on.

SPEAKER_00 11:49

Yeah, it's really just another piece to consider. Like, where's the money going? Could it be going to the build? In what fashion could it be going to the build? And which one makes the most sense? And there's like a thousand ways to look at this, but that's why having that team is so like quintessential. You have to do that.

Forever Home Or Next Step

SPEAKER_01 12:06

It is, because even if you even if you had a goal that you wanted to build a house in the future and you're renting right now and you just want to wait and save the money, prices are just gonna keep going up. It may be a better solution for you to buy a starter home right now. Don't build right now and then start building that equity that you could then later use to go towards that new build. Right. That way you're at least investing in yourself. Because when you buy a home, it's no different than like investing in your 401k or the stock market. It is appreciating over time that equity is building. And when you sell that home, you can utilize that equity to put down on your future new construction home or your next home.

SPEAKER_00 13:00

So, one thing we've talked about a few times throughout the podcast is like this financial readiness aspect to a build, right? And that's kind of what we're touching on right now. And and we we kind of beat that horse to death, but there's an emotional readiness to launching a new build. So, I mean, what do you see as far as like emotional readiness and the lending side of things?

Don’t Gamble On Future Policy Shifts

SPEAKER_01 13:25

Yeah, I mean, it just is really does it make sense for your situation right now? Is the question that has to be asked. Because emotional readiness, I can tell you right now, like I can be not emotionally ready to go buy new furniture right now, you know, like emotions really drive a lot of things for us. Um not to get just completely off topic, but like even like starting a family or you know, buying a new car, like there's all kinds there's huge financial questions that you ask that are driven emotionally. And so you just really have to train and change your mindset of what is it that you're actually waiting on.

SPEAKER_00 14:16

Yeah. I think you know, from the builder side and the design side, when somebody comes in and they sit down to talk to us, basically, like the way we approach it is okay, like what are what are your goals? We try to get to know them a little bit as a family or as an individual, and what are their long-term goals, short-term goals, and how does this build fit in that scope, right? Like, because building a house, great, we want your business, we want to do that. But if you're also trying to, you know, buy a car, buy a farm, all this other stuff, you know, prioritizing those. Where do they need to fall? How does that affect finances? And so when we say emotionally ready, it's you know, that strategizing the wants and needs and and really honing that in on what's gonna be best overall for the long-term goal of this individual.

Today’s Leverage: Price And Concessions

SPEAKER_01 15:12

Yeah, and the question is that I tend to ask somebody in those starts is how long are you planning on staying in this house? Right. You know, are you gonna be here in the next three to five years? Um let's run the numbers. Uh, we'll get you an estimate. Are you comfortable with what your payment is right now? Or are you just waiting for the rate to drop for yourself to be comfortable? Uh, and you know, are you really building based on your current lifestyle and stability, or is it speculation of what is to come in the future?

Using Incentives: Rate Buydowns Over Price Cuts

SPEAKER_00 15:48

Man, it is one of the number one things we talk about. They come in, they sit down, say, all right, we're about to design your home. Is this an agent place home? Are you is this the house? I ask it a little more crudely than that. I always ask, are you gonna die in this house? Or like are you being buried in the backyard, or is this something like you're just doing it for a short period of time and you're gonna move on? Because financially it matters, in the design of the home, man, it it it will change everything about how you design a house. Uh, if that's the place you're going to stay in forever, there's a lot less concessions that you're willing to make long term, uh, especially like structurally. Yeah. You're going in there going, like, we're gonna do this now because I don't want to circle back later to do this, or I'm not going to circle back later to do this.

SPEAKER_01 16:41

Absolutely. And you know, it's it's easier to add stuff up front than it is to go back and and redo it later. Absolutely, absolutely. Yeah, we've talked about that uh even back in season one, just uh the price of like an addition or a remodel.

SPEAKER_00 17:00

You know, it's close to I wouldn't say well, maybe double of what it would cost you to probably not quite double, but you're you're edging up on it depending on what all you're doing. Uh as far as like, you know, adding on a room versus paying for the room while subs and everybody are on site doing it while the build's going on, it's way more per square foot to do that later.

SPEAKER_01 17:25

And you know, that's just an important conversation to have because if this is not your forever home, then maybe you can do without that for now. And then looking at what your monthly payment is, are you comfortable with where this monthly payment is right now? Or is this a I can get by with this for six months and then I'll refinance when the rates drop? Dangerous.

A Simple Decision Framework For Buyers

SPEAKER_00 17:46

All right. Don't do that. But you get so many people that come in with, okay, well, I heard on the news that Trump's replacing the chair, right? The Powell's out, new Fed chairs coming in, and uh, you know, corporates can't buy single-family homes, corporates can't buy single family homes. He's trying to get uh Fannie Mae and Freddie Mac to buy a bunch of stuff and to try to get basically like points off. So I think he's gonna do it, right? Like that's the that's the approach, and I hope he's gonna do it. I hope rates are gonna come down. Everybody says that. So I can swing it for a little while and I'll hope to be able to refi. That's a bad approach.

Final Thoughts And How To Reach Us

SPEAKER_01 18:32

It is, it is, you know, it it it it would be great if we can get to that point, but let's be comfortable with where we are now and take advantage of that with a refinance. Be comfortable and then pleasantly surprised. Like don't don't you know do it the other way. Let's just have let's just go back a couple years. One of the big topics that was coming up was student loan forgiveness. Student loans are just gonna be completely wiped out and forgiven. You remember that conversation? Yep, I do. Has it happened? Not to my knowledge. No, so you know, whatever is in the headlines right now, it generates buzz in the market and it's great. And if those things happen, then like you say, let's be pleasantly surprised and take advantage of it at that time, but don't wait for it.

SPEAKER_00 19:29

But that's a good point, right? So had you during that time said, okay, I qualify and I can go ahead and build and I can make the payment while I have my student loan, but it's gonna be tight. Like I can't, I can't do anything else. A car can't break, nothing can go wrong, but that's gonna be gone soon, right? Because it's gonna be forgiven. And then that doesn't happen, and rates stay the same and or go up. You're stuck in a tight situation, and now your car's gone out, and then a car goes up. Well, now what are you what are you doing? You're putting yourself in a very difficult spot that you don't really have to put yourself in. So just yeah, you know, being smart, buy based on your lifestyle today, right? I'm not telling you like live like so far below your means that you you you have to go buy you a tiny house and when you can afford this bigger home. That's all I'm saying. I'm saying just be cognizant of what you're doing, plan, right? And and just really focus on making decisions for today and then adjustments for the I guess the betterment of your payment, like down the road.

SPEAKER_01 20:44

Yeah, yeah. So, you know, one thing that buyers do have right now that they didn't uh a few years ago when rates were low is negotiating power.

SPEAKER_00 20:57

They have leverage, they do have a lot of leverage right now. Um that's coming out in different ways, you know. Uh I know you deal a lot more with like the spec home type stuff, and so if you want to speak a little bit to that, like pricing and concessions, concessions or everything with those guys.

SPEAKER_01 21:15

So buyers right now, uh the leverage and pricing and concessions. You can negotiate that sales price, you can negotiate for sellers to buy your interest rate down, throw in that refrigerator, throw in blinds. Um, but you know, it also being smart about it because let's talk production homes for a second. You go into a neighborhood where there's production homes, and we talked about it a little bit on the last episode where the production homes are really like building their own comparables and being able to curb those appraisal issues that customer homes are seeing. Well. That is true because they don't want the values, they're not going to drop the price necessarily because it's going to hurt their future values. Right. But what they are doing is offering really high incentives to buy their homes. So where they may keep the price, you know, let's just use real number and say they're keeping the price at$400,000. Because, you know, they've sold homes in that neighborhood and it's been appraising. But the market isn't really, buyers are not seeking$400,000 homes right now.

SPEAKER_00 22:38

Right.

SPEAKER_01 22:38

So they're slow and having a hard time moving them. Rather than dropping the price to say$375 to where more buyers be interested, they're going to offer$25,000 and what they'll call flex money. What you can do with that is you can cover your closing costs if you're financing. You can lower your interest rate. You can put in enough privacy fence in your backyard. You could, you know, build that outdoor kitchen or the fireplace.

SPEAKER_00 23:12

It's almost just a cash allotment to like, hey, here's this incentive to buy this house at the purchase price. And what that the benefit for them is they got one more house to justify their comps.

SPEAKER_01 23:24

Yep.

SPEAKER_00 23:24

They're showing movement on their development. Yep. So it's it's oh, hey, a whole home sold over there, that's hot now. And uh there's a lot of incentive for them to do that.

SPEAKER_01 23:35

It's not just, you know, absolutely giving it away. From a lender side of things, you know, being able to utilize that money to buy discount points and lower the interest rate goes so much further on your monthly payment than lowering the sales price. Because when you think about it, you know, you can lower if you buy down your interest rate and you lower your interest rate 1%, right? You're saving, I mean, anywhere from$100 to$150 or more on your monthly payment.

SPEAKER_00 24:12

Yeah. So somebody who may not have qualified for a$400,000 house over here may qualify for a fourth$100,000 house over here because there's enough incentives to get them in the ballpark of their monthly payment.

SPEAKER_01 24:26

Right. But then let's flip it and say, well, you know, I don't, I don't want to pay those discount points. That just goes with prepaid interest and it's just gone. So if you take that$400,000 and you lower the sales price by that same money, you know, let's say they spent$15,000 to lower your interest rate and they gave you the extra$10,000 to put in a privacy fence. Right. That's how you use your$25,000. Well, let's say you kept that privacy fence and you lowered your interest rate$15,000. So you're at$385,000. You're really looking at the difference between financing$400,000 over 30 years or$385,000 over 30 years.

SPEAKER_00 25:17

Yeah, no, no brainer.

SPEAKER_01 25:19

No, you're no brainer. You're not for real saving any money by the way. No, not at all. So the bigger bane for your buck is to really apply it to your interest rate because if you can get a lower interest rate over that money, then that is more cost effective for you.

SPEAKER_00 25:36

Yeah. So, you know, if you guys are listening to this and you're still like unsure about any of this stuff, there's like a uh kind of a simple framework that we put together, just like real plain language. I'll I'll read that real quick. So, you know, number one, you know, it if you if you buy now, or if I'm buying now and rates never change, am I okay? That's a really great question to be asking yourself. Yeah. Number two, if rates are gonna drop later, do I have a process, a team, an individual to contact, my lender to help me step through the process of getting that better rate? Uh and last but not least here, you know, if I wait and prices rise, what is that gonna cost me? You know, to think through I'm good today, but the there might be a better rate around the corner. But if I wait for that better rate for six months, what do I lose in the six months? That doesn't mean that that's a bad decision. It just means that's something you should weigh and and count the cost, right?

SPEAKER_01 26:43

And you know, the goal here really isn't to tell you to buy now or wait. I mean, the goal is to really help you make that decision confidently. So when markets do change, life changes fast uh around. And uh the worst decision is staying stuck because you are unsure of what to do.

SPEAKER_00 27:05

Absolutely. So if you're a buyer, you're a potential build client, uh, anybody looking to do this kind of stuff, and you have any questions, feel free to contact us. Uh, you can get a hold of us through our Facebook accounts. We both have individual Facebook accounts as well as business accounts. Uh, we're both very responsive to those. Um, email, text, and you can get our phone numbers by contacting us through email or Facebook. Um, got any questions at all? Just reach out to us and uh appreciate your time. Look forward to seeing you guys again next time on Constructive Conversations.