Calculate Your Home Building Cost Figuring out home building cost can get complicated if you are looking for an exact number prior to building your home. Estimating home construction cost is the number one question on the new owner builders mind prior to home construction. You have to face the reality of getting financed, if you are not paying cash for your new home, and even if you are paying cash, you want to know how much. The bank really doesn't want to hear I think it is going to cost about this much! This page is here to give you the know how to estimate the cost of your new home.
First I want to mention cost estimating software. I tried a couple of them prior to building our home, and it was a fiasco! I used a couple that were free on the net, and it was a disaster. After building the house I figured it all again using the estimates, and some were as close as $50,000 dollars on the estimated building cost, and the worst were off by over $100,000. Ouch!! Try getting financed with a variance like that. I don't know about you, but I don't want to be that far off.
Let face it if we were professional builders we could do a much better job of estimating, but guess what we are not. Our goal is to build a great house and save as much money as we can doing it. It is true that hindsight is 20/20. So welcome to George's method for Home Construction Cost Estimation! My method may seem drawn out but it will help you find the magic number.
Let's get started! First I want to mention cost estimating software. I tried a couple of them prior to building our home, and it was a fiasco! I used a couple that were free on the net, and it was a disaster. After building the house I figured it all again using the estimates, and some were as close as $50,000 dollars on the estimated building cost, and the worst were off by over $100,000. Ouch!! Try getting financed with a variance like that. I don't know about you, but I don't want to be that far off.
Let face it if we were professional builders we could do a much better job of estimating, but guess what we are not. Our goal is to build a great house and save as much money as we can doing it. It is true that hindsight is 20/20. So welcome to George's method for Home Construction Cost Estimation! My method may seem drawn out but it will help you find the magic number.
Let's get started!
 Home Building Cost
Home Building Cost - Step 1
- Look for Houses You Would Buy -Go shopping for new houses in the area that you are going to build. You need to get an idea what you would have to pay for a house if you bought it from a builder. Find the size house that you want with the quality that you want. If you are interested in building a custom house with first class fixtures and amenities go have a look at those type houses. Note the price, the square footage and then divide it out to figure your cost per square foot. This may seem a little simplistic but it will do two things for you. It will give you some good ideas about what you want, and give you a ball park on cost if you buy it from a general contractor.
Remember look at houses that you would like to buy. Be realistic shop in your price range.
You can figure about 30 to 40% savings if you General Contract the House yourself.
Home Building Cost
Home Building Cost - Step 2
- Pick Your Plans -Now that you have a good idea of what type of house you want it is time to Buy Some Plans and get serious about building your dream home. Go to the House Plans page and search thru literally thousands of plans. Take your time and find the plans that are just right for you. If you find a plan and want it customized the services we recommend can also do that for a small fee and give you just what you want.
Once you have selected your plans review them and make sure you have everything you want. If not make a list of each item and then....
Home Building Cost
Home Building Cost - Step 3
- Find a Builder -Now before you think I have lost my mind let me explain. You need to know what it will cost if you have a professional builder build your new home. Why? Because they will give you a very good idea what your exact house will cost to build in your area. Please do this with at least 3 Custom Builders. NO, I am not wanting you to be cruel to the Builders, but yes, I am wanting you to get an Idea what it will cost if you use one of them. Let's face it, if they are reasonable enough you may just let them do it.
Take the figures you get form the Builders and average them out and figure you can 30 to 40% if you build it yourself.
Home Building Cost
Home Building Cost - Step 4
- Get Bids form Contractors -This is where we separate the serious Owner Builders from the, I am just thinking about this Owner Builders.
Get bids on each Contractor that you will use to build your home. Go to the Building Contractor page for information on this step. You also need to go to the Home Construction page to get a list of your trades, they are bolded. This is one of, if not the most important steps in building your home. Find good contractors they will make or break your project!
It is to be noted that you may choose to make some of your items turn key. In other words it may be in your best interest to wrap the labor and the material into a single bid. I did this on my foundation and the roofing. You can read about this on the Home Construction page.
Get the bids add them up, and now you have the labor cost to build your home.
Once you have finished section 1,2 and 3 you should have good idea what it is going to cost to build your home. Is it time to go to the bank? NOPE, you need to have a detailed building plan and cost estimates that are rock solid!
Home Building Cost
Home Building Cost - Step 5
- Figure the Cost of Materials -Now it is time to figure out what the materials are going to cost. Take your marked up plans to a three building materials suppliers. I got bids from Bison, Home Lumber and McCoys they are the largest in this area. Get them to do a line item bid on everything you will need to build your house. They will do this for free. They will give you a report on the cost of every item that is needed to build your house and a total cost. Make sure you ask them if this includes shipping to your jobsite.
Take the three and compare them, whoever is cheapest wins. If you have preference and they are higher, ask them for a break on the cost. In fact ask them anyway they will usually give you a break on the cost. They will all offer turnkey pricing on everything including doors and trim, some even provide windows. In most circumstances Doors and Windows are cheaper bought directly from the manufacturer in your area. See the Exterior Door page and the Window page for more information on this.
The building material suppliers normally do not have good pricing on plumbing fixtures and lights. You can get a bid from them and compare. I found The Home Depot to be very competitive on plumbing fixtures and Lamps Plus to be competitive on lights.
Home Building Cost
Home Building Cost - Step 6
- Total Costs -Ok, now we can add it all up and figure out what your new home is going to cost. First let's recap the steps: - In step one you looked at houses and found the ones that you liked and got a good idea of cost per square foot. You then figured you could roughly save 30 to 40%. This will give you an idea of what you can afford to build, so you can now select a plan that is both within your budget and fills your needs.
- In step two you chose your plans and revised them as necessary.
- In step three you got bids from Custom Builders to see what they would charge you to build your dream home using your new plans. You then figure you will save about 30 to 40%. You now have some assurance that you are in the right range and proceed to step four.
- In Step 4 you find the Building Contractors to build you new home. Select the right one at the right price.
- In step 5 you find your materials suppliers and the right pricing for materials.
Now you are ready to add up all your costs, labor and materials and you have the cost of building your new home, right? Nope, not yet we have a couple of Items we need to discuss.
The following Items are left to figure into your cost: - The cost of your land. For help finding the right land, see the Buying Land page.
- The costs of Permits and Inspections. This will vary with the area you are in. The best way to find these costs is call you county, parish, or city government and ask questions. They will be more than happy to help.
- The costs of utility hook ups.
- The cost of the final grade on the lot and landscaping. This will vary with what you want in particular.
- The cost of road construction if any for your property.
With the exception of the price of the land, the rest of the items above are not that significant (unless you have to build a long road to your house). The only consideration left is items that you may choose to do yourself, like painting, landscaping etc... You can reduce the cost of you home by completing some of the items yourself. Of course if you have a construction loan you need to consider the time that it takes to complete items yourself.
Make a detailed list of all of the above items add them all up and viola, you have a cost for your new home.
Now you are ready to go look for your money. Go to the Construction Loan page for details . |
