Building your own house is the opportunity to get exactly what your dream house is. Maybe the homes in your desired region are too big or too small than your requirements; you might consider a custom home built from scratch.
The cost to build a house may be something that you are thinking about for a long time that you can afford! In specific sites, it could cost you less to build than buying existing homes. According to the NAHB (National Association of Home Builders) the average cost to build a new house is approximately $485,000, whereas the U.S Census Bureau estimates it at approximately $397,000.
However, the precise cost to build your own home varies as it is influenced by a number of factors, including the square footage of the land, the state where you want to live, the quality of the materials, the supply and demand for labor in the area, requirements for floors, regulations, and permit requirements, etc.
Breakdown of Cost To Build a House
Here is the categorization of different expenses that make up the cost to build a new home.
Off-Site Concurrent Cost
While deciding on building your own home and creating a budget, it is necessary to consider concurrent costs like living expenses during home construction until you move in safely. The construction period can be from months to two years, depending on the availability of labor, materials, and builders in the region.
The first expense you will meet is the land cost. The land cost varies depending on various factors, i.e., the area footage and its location. On average, the NAHB estimates the average price of plot size around 22,000 square feet or about a half-acre under $90,000 that is affected widely by many factors that include the soil quality to the view from your new exterior porch.
Mapping and Permits
After purchasing the land, you need an architect to draw up the plan and obtain the necessary permits. Then, your contractors can start building the house. The cost can go up to $18,000. This cost may differ depending on the intricacy of the building and the types of permits. It includes the cost of preliminary inspections also like water and sewage. Existing lines can lower the cost.
The charge for new lines goes up to $4,500. To reduce the cost, one can purchase pre-designed blueprints. However, for a truly custom home, you have to plan a budget with architect fees ranging between 8 and 12% of the construction cost.
Construction Management Cost to Build a House
You may require the aid of a construction management firm on the recommendation of your architect to command your project. With the help of an experienced project manager, you can easily coordinate laborers, organize material deliveries, and manage artistry quality. The firm helps to complete the necessary paperwork also. It can charge anywhere between 5% – 15% of the total construction cost to take your headaches.
It is time to dig out your home’s foundation accordingly. Among slab, crawl space, or basement foundation, the cost of concrete slab foundation is relatively lower. The crawl space is the most expensive that requires more material and additional excavation. Thus, the choice for the foundation depends on your budget and preferences. The price to build a house will include this cost between $8,200 – $35,000.
Framing the Home
A new home begins to take your desired shape during this construction stage that makes the highest material cost in most cases. It is the process of framing the floors, walls, trusses to frame the roof, sheathing, and subfloor installation, and then covered with plywood or oriented strand board. Metal stud framing costs you $20,000. High-quality wood framing can cost up to $51,000.
Installing External Elements
Necessary external elements are walls, roofs, and openings where sidings will be installed. The cost of siding is about $12 per square foot, which varies for different siding types, such as vinyl or high-end natural stone.
Plumbing and Electrical
Now the cost of plumbing and HVAC systems installation for proper supply of water, electricity and air in the house. This behind-the-scenes material like pipes and ducts can cost you up to $43,000.
Interior finishes include all the essential elements to turn a building into a livable home, i.e., adding insulation like batting, blown-in or spray foam – average cost $4,000, flooring – $6 to $10 per square foot, drywall – $2.25 per square foot, painting – $5 per square foot, fixtures about $5,000 – $10,000 as per the luxury you choose, interior doors – average cost $6,000, cabinets and countertops – an average of $6,550.
The ability to build a custom-made home is appreciable to get the dream house. Many stories, high-end, luxury homes, and architectural flourishes will be much more costly naturally. The cost to build a tiny house, a very simple one, can be relatively affordable. If you find the cost to build a custom home pricey, you can cut down the luxurious items from the budget that can be installed later.
When to consider building a house
If you look at the average cost to build a house, it’s worthwhile to invest for years and years. Still, you can consider the following points to decide on the custom home:
- You can customize your own home as per your budget that will be a long-term investment.
- As long as your home is well-constructed, it requires less maintenance that lets you feel comfortable. An existing house may furry you with huge costs of upgrades and repairs like roof replacement.
- You can live in the desired location with the desired amenities in the custom home. You can take the opportunity of getting everything you want. Buying a pre-built home involves a lot of compromises.
- A number of decisions are involved throughout building a custom home, from budget to finishes made. It is a time-consuming process. Spare yourself for months may not be possible for everyone.
- If you can manage to repay a loan on time, you can just head on to your dream house with loan credits.
- Compare how much does it cost to build a house and buy an existing one off the market.
How to afford building your own home
Hopeful homebuyers can take advantage of a home construction loan or construction-only loan to cover the cost to build a home. A home construction loan is a short-term loan that can be converted into a traditional mortgage loan after completing construction work. On the other hand, a construction-only loan covers the construction cost and, once the construction is completed, you can utilize a traditional mortgage to repay the construction loan.
The Bottom Line On The Cost to Build a House
You can get a general idea of what is the cost to build a small house that will increase based on numerous factors impacting the construction cost. Whether building or buying a house mainly depends on the real estate market. Most homeowners employ $150,000 – $445,000 to build their homes. Such estimates can give you an idea of what you will need to pay to own your home. Besides the cost, it is necessary to consider the long-term benefits of customization.
For more finance-related concepts you can have a look at the FinanceShed, and stay tuned for more updates.