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How Much Does it Cost to Build a House?

Last Updated on February 4, 2024
Written by CPA Alec Pow | Content Reviewed by Certified CFA CFA Alexander Popinker

Building a new home is an exciting endeavor, but it also represents a major financial investment. Determining an accurate budget and understanding the important factors that influence construction costs are critical steps for anyone embarking on a new residential construction project.

This guide examines the primary expenses associated with house construction to help you estimate your total budget.

How Much Does It Cost to Build a House?

Constructing a new home typically costs $200 to $500 per square foot. Most new single-family homes fall in the $150,000 to $500,000 range.

However, many factors will impact your specific building costs, including house size, materials, custom designs, and finishing touches. Location is also a major cost driver, with expenses varying widely by region and market conditions.

According to Rocket Mortgage, the average cost to build a house is about $297,218. However, the total cost of building a custom home can vary quite a bit depending on the choices you make, the building materials you use, labor costs, and even what region of the country you’re in.

Most homeowners spend $111,980 – $484,293 to build their homes.

Bankrate writes that the national average cost to build a single-family home in 2022 was $284,764, according to data from HomeAdvisor. That price, however, can range from as low as $110,765 to as high as $459,152.

Prices vary widely depending on the region of the country where you’re building and the specific costs of materials, labor, and other factors.

Houzeo notes that on average, it costs $147 per square foot to build a house in Florida. Building materials make up approximately 50% of the overall construction prices. You can expect to spend about $50 per square foot on material costs.

Contractor charges can range from 10% to 20% of the total cost. The overall cost of building a house in Florida can vary depending on the type of property, square footage, and customizations you choose.

Typically, it takes 9 months to build a house, but it can take up to 12 months if you choose to DIY.

According to New Home Source, the cost to build a house in Florida ranges from $60 to $150 per square foot depending on whether it’s an average home or a luxury home.

The cost of materials is about 50% of the total cost to build, with lumber costs ranging from $25,000 to $65,000 and concrete costs ranging from $1,000 to $10,000.

The cost of insulation ranges from $0.10 to $1.00 per square foot, and the cost of siding ranges from $2 to $15 per square foot.

Factors That Determine Home Building Costs

Several primary considerations will dictate your overall budget for building a house:

  • Square footage – The size of the home significantly impacts total costs. Larger homes cost more to build but may have cheaper cost per square foot.
  • Custom design – Unique designs, luxury finishes, and custom features add expenses compared to contractor-grade finishes.
  • Materials used – Structural materials like wood, steel, or concrete affect framing/foundation costs. Finishing materials also range widely in price.
  • Location – Factors like land prices, labor costs, and building codes cause regional variations. Rural areas tend to be the cheapest.
  • Site prep requirements – Challenging sites requiring substantial grading or special foundations add costs.
  • Green building or special features – Energy efficiency upgrades, solar panels, smart home tech, and amenities like pools cost more upfront.

Carefully weighing your needs, tastes, and budget constraints will help guide intelligent decisions about home size, design, materials, and features. Consulting local builders is also wise to understand costs for your specific area.

Acquiring Land for Your New Home

Before beginning construction, you’ll need to purchase and prepare your building site. Land costs vary tremendously based on location, size, and zoning parameters. Rural areas can be as low as $10,000 to $50,000 per acre, while land in urban centers often costs over $1 million per acre.

In addition to the base price of the lot, you may need to budget for:

  • Surveying – For precise property boundaries and topography ($500-$5,000)
  • Site testing – Evaluating soil, drainage, etc. ($3,000-$7,000)
  • Building Permits and fees – For zoning, land-use changes, utility connections
  • Site prep – Clearing, excavation, grading, access roads

Shop around and research underlying land costs before selecting a construction site when you will build your own house.

You might also like our articles about the cost of building a brick house, guest house, or apartment complex.

Design and Planning For a New House

The design process has significant up-front costs but is essential for controlling the overall budget. Key design expenses include:

  • Architect fees – Around $8 to $15 per square foot, including creation of detailed plans and permits.
  • Engineering – Structural engineering to ensure home stability and compliance.
  • Permitting fees – Varies by location but often $1 to $2 per square foot.

Investing in professional designs and planning helps avoid budget overruns. It ensures your home meets zoning and building code requirements while expressing your lifestyle needs and aesthetic tastes.

Foundation and Structural Framework: The Hidden Costs

Constructing the foundation and structural framework comprises between 15% to 25% of total costs, making it one of the biggest line items in your new house construction budget.

Major foundation expenses include:

  • Excavation and footings – Digging for foundation and pouring concrete footings.
  • Concrete slab or basement – Materials and labor costs, potentially including waterproofing and drainage.
  • Special foundations – Expensive pilings for soft soils or steep slopes.

Typical framing costs for wood-frame homes are around $15 to $25 per square foot, including labor and materials for walls, floors, and roofs. Post-frame or steel-frame homes have different costs. Regional labor rates significantly impact framing expenses.

Mechanical Systems: Plumbing, Electrical, and HVAC

Major mechanical systems represent about 15% to 25% of construction costs. Their price depends on system complexity, quality of fixtures/equipment, and regional labor rates.

Plumbing$7,000 to $10,000 on average, including pipes, fixtures, water heater, and labor.

Electrical$5,000 to $10,000 for wiring, panel, lighting fixtures, and devices.

HVAC$7,500 to $12,000 for furnace/AC, ductwork, vents, installation and labor.

Choosing energy-efficient systems like tankless water heaters, LED lighting, and high-SEER HVAC can increase upfront costs but save on the long term.

Exterior Finishes: Siding, Masonry, Roofing, and More

Exterior finishes greatly impact both aesthetics and weather resistance. Prices range considerably based on the materials and labor involved:

  • Siding – Vinyl ($3,000 to $7,000), wood ($10,000 to $17,000), fiber-cement ($9,000 to $12,000).
  • Brick/stone veneer – $6,000 to $20,000, depending on masonry type and coverage area.
  • Stucco – Around $6 to $9 per square foot including labor for traditional 3-coat application.
  • Roofing – Asphalt shingles ($5,000 to $10,000), metal roofing ($10,000 to $20,000).

Consulting local material suppliers can help estimate regional pricing for exterior finishes.

Interior Finishes: Walls, Flooring, Millwork

Interior finishes like drywall, paint, flooring, trim, and cabinetry typically account for 15% to 20% of the total budget. Prices vary based on material grades and quality levels.

  • Drywall installation – Around $1 per square foot (materials and labor)
  • Flooring – Carpet/pad ($2 to $6 per square foot), hardwood ($6 to $15 per square foot), tile ($3 to $20 per square foot).
  • Cabinets and countertops – Stock cabinets ($2,500 to $7,500), granite countertops ($3,000 to $7,000)
  • Moldings and trim – $2 to $6 per linear foot for simplified designs. More for custom millwork.
  • Painting – $1,500 to $4,500 for a 2,000 sq. ft. home

Luxury materials like hardwood floors, stone surfaces, and wood trim raise costs. Careful shopping allows budget-friendly finishes that still provide beauty and function.

Windows, Doors, and Insulation: Energy Efficiency Matters

building a house can have a big priceNew, energy-efficient windows and doors help control heating/cooling costs over time. Key expenses include:

  • Windows – $350 to $700 per window installed depending on efficiency, material (vinyl, wood, fiberglass), and regional labor rates.
  • Exterior doors – $500 to $3,000 per door depending on material, insulation value, and design.
  • Insulation – $1 to $2 per square foot to insulate walls and attic. Critical for energy efficiency.

Though insulating and sealing the building envelope adds upfront costs, it usually pays back through lower energy bills over time.

Electrical Fixtures, Plumbing Fixtures, Appliances

Finish plumbing, lighting, and appliances add functionality and visual appeal. Budget approximately:

  • $1,500 to $4,500 for bathroom plumbing fixtures like toilets, faucets, and shower systems.
  • $3,000 to $7,500 for kitchen plumbing fixtures including sinks, faucets, and appliances like dishwashers.
  • $2,500 to $5,000 for lighting fixtures and ceiling fans. More for smart home tech and elaborate chandeliers.
  • $3,000 to $10,000 for major kitchen appliances, depending on brands and features chosen.

Careful selection allows high-quality fixtures and finishes while controlling costs.

Landscaping, Decks, Garages, and Outbuildings

While not essential, outdoor features can maximize enjoyment. Typical price ranges:

  • Basic landscaping – Around $15 to $30 per square foot, including plants, mulch, hardscapes.
  • Paved driveway – $7 to $15 per square foot.
  • Wood deck – $15 to $50 per square foot.
  • Garages – $35 to $60 per square foot to construct.
  • Swimming pools – $35,000 to $70,000 for an average sized in-ground pool.

Prioritize features that suit your lifestyle.

Additional Costs to Keep in Mind

Construction projects often involve unexpected costs and budget overruns. Things like change orders, permitting delays, or fluctuating material prices can increase your final spending. Adding a 10% to 20% contingency fund to your initial budget helps cover surprise expenses.

Ongoing maintenance and future renovations are other long-term costs to consider. Budgeting about 1% to 3% of total construction cost per year for maintenance helps avoid deferred costs piling up down the road.

Carefully research all costs, get contractor estimates in writing, and manage payments during construction to control spending. This helps deliver your dream home while staying on budget.

Financing Your Home Building Project

Since construction costs are typically paid over months or years, financing is crucial. Common options include:

  • Construction loans – Shorter-term financing for building costs.
  • Mortgages – Longer-term loans for paying off construction financing.
  • Investing your own funds – Paying cash obviously avoids financing costs.
  • Owner-builder construction – You act as general contractor to save costs.

Shop around to find the best loan terms and interest rates. Having financing pre-approved makes the process smoother.

Final Words

Building a new home is a complex, multifaceted process. While total costs typically range from $100 to $300 per square foot, many factors influence your specific budget.

Careful planning, research, and expert help control expenses while delivering your ideal home.

Frequently Asked Questions

What is the average cost per square foot to build a house?

The average cost to build a home is $100 to $300 per square foot. This equates to roughly $150,000 to $500,000 to construct a typical 2,000 square foot single-family home. However, many factors like location, finishes, custom designs, and site conditions cause significant price variations.

Does it cost more to build or buy a house?

Building a new home typically costs $15 to $25 more per square foot compared to buying an existing home. However, building allows you to get the home layout, finishes, features, and location you want. Building on land you already own also lowers costs.

Overall, building makes more sense if you plan to stay in the home long-term.

How do I control costs when building a new home?

To control home building costs:

  • Hire an experienced designer/builder with a proven track record of delivering homes on budget.
  • Research local material and labor costs so you can set realistic expectations.
  • Understand what finishes and features you can live without to reduce unnecessary expenditures.
  • Compare quotes and negotiate fixed-price contracts with subcontractors.
  • Avoid making structural changes or adding upgrades once construction begins.
  • Supply your own materials when possible to save markup costs.
  • Monitor progress carefully and only pay for completed work milestones.
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