How much does it cost to build a new house?
Variables that affect the cost of building a home
- Construction costs do not include the cost of purchasing or preparing the lot.
- Custom or luxury materials, amenities or house features will increase the cost.
- Two-story homes are generally cheaper than one-story homes of the same square footage.
If you are thinking about building a house instead of purchasing an existing home, you are probably wondering how much it will cost. As with purchasing a home, the answer to that question depends on where you plan to build. Land, materials, labor, and even architect and builder fees will be higher in regions with higher costs of living — all of which will impact the cost of building a home.
Land lot costs
To give you some ballpark numbers, a study performed by the National Association of Home Builders stated that the average American home built in 2015 cost $103 per square foot. The same study stated that the average size of a home built in 2015 was around 2,800 square feet. Multiplying these two numbers together gives you an average cost of $288,400.
This number does not include the price of the lot or any work needed to clear that lot, level it and prepare it for foundation work. This price covers the cost of construction materials; amenities like countertops, flooring, built-in or included appliances; and all finishing materials. It also includes the cost of labor employed by the contractor, including subcontractors such as plumbers, electricians, roofers, etc., as well as builder fees and markups, architect fee, and permits needed to complete the construction. In addition, this cost reflects the financing costs incurred to secure funding to pay for the construction.
Obviously, if you want your new home to have above-average amenities, this cost will increase. In addition to things like granite countertops, marble flooring or high-end appliances, specialty features like curved staircases, vaulted ceilings and multiple roof pitches also will increase the cost of construction.
The shape and type of house you decide to build has an even larger impact on the total cost of construction. Square and rectangular designs will be cheaper than homes that include interesting angles or extra wings. Two story homes also will be cheaper than one-story homes of the same square footage. These cost differences all come down to foundation, roof, and support costs. A square, two-story house requires roughly half the roof and foundation size than is required for a one-story house with the same square footage. Odd roof angles or homes with nonsquare designs will require extra support beams, increasing the cost over the standard square or rectangular house.
Because of all of the variables that enter into the equation, the best way to estimate the cost of building your new home is to look at other new homes in your area that have designs and amenities like what you are hoping to incorporate into your new home and find out how much those similar houses cost to build. You can then divide the total cost by the number of square feet in the house to determine the cost per square foot. This will give you a decent benchmark number to compare against any estimates you get from contractors.