If you are looking at the big picture, yes because it has disastrous effects. The country’s GDP or gross domestic product will go down and so will consumer spending. People will be out of work and some businesses may even go bankrupt.

Should construction be your line of work and selling these materials is your business, yes you should also worry because construction firms will not buy the same volume of goods from you since there will not be many people who are willing to buy or build a house right now.

But what if you have a stable job in another industry and think it is time to build your home now? If that is the case, then there is nothing to worry about. If you have the money and want to move to a bigger home, now is the best time to find someone who can help you design, plan and make it come to life.

The reasons for these are simple. A decline in home building has it advantages mainly labor and materials are cheap so you can spend the same amount of money for more things. You won’t have a hard time finding a contractor because they will most likely give you a good deal rather than losing you to someone else which means they don’t have any business.

You should just tell them straight how much is your budget and add an allowance because there may be some unforeseen changes which have to be dealt with later on.

There are two types of unforeseen circumstances in construction. The first is customer generated which means you want something else done. The other is site generated which means there is something on the property that is creating the problem. In the event either of this happens, you have to be ready for it because in construction, everything looks good on paper but things change when people are actually working on it.

If you can’t afford to build a home, you can try to buy one right now because the price of real estate has slumped and this could go even lower. This means you can buy the house of your choice right now because there are a lot of unoccupied homes and people have to move in to them first before construction companies decide to build new ones.

Don’t forget a large number of them that have been foreclosed so there could also be a good bargain over there.

You won’t even consider building a home during a decline in home building or any other time if you did not have excess cash lying around and since that is not a problem, you can now go out there and find a contractor who can do this for you at a reasonable price.

So should you worry when there is a decline in home building? No if you are financially stable but if you are not, then it is time to tighten that belt because if you don’t, you could end up being one of hundreds of people who have lost their homes since last year.

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What this means is that the number of homes or apartments being built will be the fewest since the Second World War. The reason for this is simple, not that many people are willing to build a home and banks are a bit hesitant whether or not to approve a loan.

In some states, there was a decline of more than 20 percent for new housing permits. This means contracts don’t have that many jobs and there is not that much money collected from real estate taxes and building permits which contribute to local revenue.

A good example is the state of California which lost more than 220,000 jobs in the past 2 years. This translates to a loss of about $30 billion to the state’s economy. Some companies have gone bankrupt with others forced to close down their projects.

So what should people do now? Well a lot of experts advise consumers to tighten their belts and then wait till the smoke clears before they consider building a new home. If you have the money, you could buy a homes sine many are up for sale especially when a lot of them are foreclosed and now owned by the bank. If you don’t have a lot of cash, make sure you save enough money to save it from being foreclosed.

Since the property of most homes has also gone down, many of the current homeowners can’t even make a profit if they decide to sell it now in hopes of building a new one.

For those who are renting, continue paying for it because it is cheaper to own until perhaps you have save enough to consider building your own home. In most places, annual rent is still less than 3% of the purchase price and mortgage rates are 6.5% which makes it cost more than double to try and borrow money to build a home.

Analysts believe that the decline in home building may be dramatic but it is as bad as you think because it is simply a market reaction to recent building which went way ahead of new household formation. What this simply means is that more houses were built than people could actually buy. The question on everyone’s mind now is how long before things are on the up trend.

Many people that it will take between two to three years for the market to stabilize so business will be back to normal by 2011. So again, if you have the money, there is a lot of houses that are now available in the market to buy and when these are sold, equilibrium is achieved and there will be a construction boom once again.

There is no doubt that the current financial crisis is the cause of the decline in home building. The good news is that things will change for the better in less than 5 years so in the mean time, those who are paying for a home should sit tight until the bailout and any other remedy the government is trying works. As for those who are renting, be patient because now is not the right time to consider building a home.

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But what if there was no financial crisis? What if you can borrow money from the bank? What if you have the cash on hand? If there were no problems, then yes why not build your dream home.

To help you along, this is what you have to do.

First, get in touch with the local builders that have constructed houses similar to the size, quality and features that you want. By talking to them, you get a straight answer as to how much it is going to cost for the entire project plus what materials they will use.

Since its been months or even a few years that these homes were built, you have to expect that it is going to cost more now to construct something similar. The rooms which will be the most expensive to make will be the bathroom and kitchen. The number of windows and their size is another factor as well as the vaulted ceilings and high roof pitches.

You will also have to include inflation because building a home increase from 3% to 6% annually. With this information, only look at homes that were built within the last 6 months.

Don’t forget to put a 10% additional allowance to your budget when you make your estimate because plans change and in most cases, you and you contract will encounter unforeseen circumstances. Naturally you have to deal with the situation otherwise there will be delays when everything will be finished.

Believe it not, the cost per square foot is higher for a small home than a big one. Why? Because the cost of items is spread over and a two story home if that is what you want has a smaller roof and foundation. The same goes for plumbing and ventilation.

Another thing that could reduce cost is the shape of the home. Houses that are shaped like a rectangle, square or dome shaped are more affordable to build since there are not that many angles or corners which increases the amount of labor and the materials that will be needed.

It will be much easier to select the final blueprints, which is the basis of the project once you have estimated the construction expenses.

As much as possible, work with even numbers because this reduces wasted materials. The ideal home to make should be not less than 32 feet deep otherwise your roof trusses will have to be custom made which will cost more.

If you had this property for a long time, then chances are the neighborhood around you is already well developed. You don’t have to haul a lot of dirt, do grading, clear trees or blast through large rocks if your property happens to be somewhat secluded.

No one in his right mind will construct a house when there is a decline in home building due to the financial crisis. You just have to keep these tips in mind when the economy does improve so you will already have an idea how much money you need to build it.

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