Build Now or Wait!

To provide a cost breakdown comparison between building a home now versus waiting until next year, I'll focus on key cost categories: materials, labor, financing, and overall project management costs. Here’s a detailed comparison for each of these cost factors, including how they are likely to differ depending on whether you choose to build now or wait a year.

1. Material Costs

Category	Building Now (2025)	Waiting Until Next Year (2026)
Steel	₱75,000–₱80,000 per ton (stable prices)	5–10% price increase due to inflation and demand
Cement	₱220–₱250 per bag (some fluctuations)	Expected increase of 5–8% due to energy costs
Timber/ Wood	₱35,000–₱45,000 per cubic meter (volatile)	Prices may rise by 10% due to supply chain issues
Other materials (e.g., glass, tiles)	Relatively stable, ₱20,000–₱50,000	5–10% increase expected
Total Materials Estimate	₱1.5M to ₱2M (for a 100 sqm house)	₱1.6M to ₱2.2M (projected 5–10% increase)

Summary: If you build now, you’re likely to benefit from more stable and lower material costs. Waiting could lead to a 5-10% increase in overall material expenses, especially due to inflation and potential supply chain disruptions.

2. Labor Costs

Category	Building Now (2024)	Waiting Until Next Year (2025)
Skilled Labor (per day)	₱800–₱1,200 per day	Likely increase by 5–10% due to inflation
Unskilled Labor (per day)	₱600–₱800 per day	Expected increase to ₱700–₱900
Foreman (per project)	₱40,000–₱60,000 per month	Likely to rise by 5–8%
Total Labor Estimate	₱800,000–₱1M (for 100 sqm house)	₱900,000–₱1.1M (projected 5–10% increase)

Summary: Labor costs are expected to rise, with a 5-10% increase likely next year. Starting the project now would save on labor expenses as wage inflation kicks in over the next year.

3. Financing Costs (Interest Rates)

Category	Building Now (2024)	Waiting Until Next Year (2025)
Mortgage Interest Rates	6%–7% (current rates)	Expected to rise to 7.5%–8.5% due to rate hikes
Loan Term (20 years)	₱3.5M loan @ 6% interest = ₱25,163/month	₱3.5M loan @ 8% interest = ₱29,328/month
Total Interest Paid (over 20 years)	₱3.54M over 20 years	₱4.54M over 20 years (approx. ₱1M more in total)

Summary: If you finance your home build with a mortgage, waiting until next year could significantly increase your total financing costs. With projected interest rate hikes, your monthly payments and total interest paid over the life of the loan could increase by ₱1M or more.

4. Additional Costs (Permits, Fees, Miscellaneous)

Category	Building Now (2024)	Waiting Until Next Year (2025)
Permits & Licenses	₱30,000–₱50,000 (varies by location)	Could rise with inflation (3–5% increase)
Project Management Fees	₱100,000–₱150,000 (varies with size)	5% increase expected
Insurance (construction-related)	₱20,000–₱25,000	5% rise expected
Total Additional Costs	₱150,000–₱225,000	₱160,000–₱250,000 (slight increase)

Summary: Waiting until next year could increase your permit, management, and miscellaneous costs by about 3-5%.

5. Total Estimated Costs

Category	Building Now (2024)	Waiting Until Next Year (2025)
Materials	₱1.5M–₱2M	₱1.6M–₱2.2M
Labor	₱800,000–₱1M	₱900,000–₱1.1M
Financing Costs (Interest)	₱3.54M (over 20 years)	₱4.54M (over 20 years)
Additional Costs	₱150,000–₱225,000	₱160,000–₱250,000
Total Costs (excluding interest)	₱2.45M–₱3.25M	₱2.66M–₱3.55M

Key Insights:

1. Building Now (2024)

   • Total costs excluding interest: ₱2.45M–₱3.25M

   • Interest over 20 years: ₱3.54M

   • Total cost advantage: Building now locks in lower material, labor, and interest rates, which can save you around ₱100,000 to ₱300,000 on immediate construction costs and ₱1M on long-term financing.

2. Waiting Until Next Year (2025)

   • Total costs excluding interest: ₱2.66M–₱3.55M (likely higher due to inflation)

   • Interest over 20 years: ₱4.54M (due to rate hikes)

   • Total cost disadvantage: You risk a 5-10% increase in materials and labor, higher financing costs, and a more expensive overall project. The longer-term impact of interest rate increases alone could cost you an additional ₱1M in interest payments.

Building a home now offers significant cost savings, especially when factoring in rising labor, materials, and interest rates. Waiting until next year could result in higher expenses across all categories, especially in financing. The total cost of waiting could be upward of ₱1.1M to ₱1.5M more in the long run due to inflation and rising interest rates.

If you have the financial flexibility and resources, starting now is likely the most cost-effective option.

Build Now or Wait!