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How Much Will it Cost to Build Your New Home?
Dreaming of building a new home, but worried about the expense? If you have
detailed blueprints, your builder can give you a close estimate. But long before
you draw up the final plans, it pays to do some "guesstimating."
Knowing how much the project might cost will help you modify your plans to meet
your budget. Here are a few good tips for you to think about.
"Guesstimate" the Cost of Your New Home?"
1. Contact Local Builders
Meet with builders who construct houses that are similar in size, quality, and
features to the home you want. Builders will tell you how much per square foot
they usually charge for home construction. They can also give you a ballpark
idea of what your dream home might cost. However, it is important to know
exactly what is included in the price. If you ask, some builders will provide
you a list showing the materials they will use.
2. Count the Square Footage
Look at newly constructed homes that are similar in size, style, quality, and
features to the home you want. Take the price of the home, deduct the price of
the land, and divide that amount by the square footage of the home.
For example, if the home is selling for $230,000 and the land costs $30,000,
then the construction cost is around $200,000. If the home is 2,000 square feet,
then the cost per square foot is $100.
Use several new homes in your area to get an approximate square footage price.
After you have calculated an average square footage cost, you can multiply that
cost by the finished square footage of your house plan to get a ballpark
estimate.
3. Expect Some Features to Cost More
The most expensive areas in a home are usually the bathrooms and the kitchen.
The number of windows and the size and quality of windows can also affect the
cost. Vaulted ceilings and high roof pitches can increase the cost of a home.
When using other homes to calculate an estimate, be sure the home has a similar
style and features of the home you plan to build.
The cost per square foot is often higher for a small home than that of a larger
home. When building a larger home, the cost of expensive items (such as a
furnace or kitchen) is spread over more square footage. Consequently, a larger
home may have a lower square footage cost than a smaller home. Also, it usually
costs less to build a two-story home when compared to a one-story home that has
the same square footage. This is because a two-story home will have a smaller
roof and foundation. Plumbing and ventilation are more compact in two-story
homes.
Small details in the design of your home can make a big difference in the price.
To save on costs, begin estimating construction expenses before you select your
final blueprints. Here are important factors to consider:
Size of Home
When building a home, it's best to work with even numbers. Have your home size
rounded up or down to increments of two feet. This reduces wasted materials.
Also, it's most economical to build a home which is no deeper than 32 feet. If
the depth exceeds 32 feet, then your roof trusses may need to be specially
designed and will be more expensive.
Shape of Home
Homes that have a rectangular or box shape cost less to build. Having more
angles and corners in the shape of your home can increase the amount of labor
and materials needed to build a home. Dome shaped homes also make efficient use
of materials and tend to cost less than other shapes.
Site Preparation
Preparing a site for construction can have a big impact on the cost of a home.
Building on a flat lot will usually cost less. If you have to haul in lots of
dirt, do a lot of grading, clear trees, or blast through large rocks, then site
preparations can become more expensive.
Cost Overruns
Usually the finished cost of a home is more then the original bid price. Cost
overruns occur from overspending the allowances, making changes, and
encountering unforeseen problems. Proper planning can greatly reduce cost
overruns. In general, it is a good idea to allow an additional 10% to cover
unexpected costs.
Inflation and Market Conditions
Usually the cost of building a home increases around 3% to 6% per year. If it
will be several years before you begin construction, remember to include
inflation into the cost estimate for your home. When using other homes to
compare prices, try to use homes that have been built within the last six
months.
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"It's
unwise to pay too much, but is worse to pay too little. When you pay too much,
you lose a little - that is all. When you pay too little, you sometimes lose
everything, because the thing you bought was incapable of doing the thing it was
bought to do. The common law of business balance prohibits paying a little and
getting a lot - it can't be done!
