If you haven’t already, go back and read the previous article, “Don’t Buy That Bill of Materials” and learn its main lesson: Only local costs count. If you’re trying to figure out how much it might cost to build a house from the plans you’re considering buying, you should get that statement tattooed on your forehead. Don’t trust the internet prices…only local costs count.
Price per square foot… Drive with care!
When evaluating the costs of building a new home, many homeowners use price per square foot as a basis for comparison. Let’s talk about pricing per square foot for a minute: what it is and what it isn’t.
Pricing per square foot is a method of roughly compare construction costs of two similar houses, houses in different parts of the country and houses with different characteristics. It is not a method of determining how much a particular design will cost to build.
I can tell you, for example, that a typical production start-up house (a standard plan built by a high volume regional or national builder) will cost around $80 to $100 per square foot to build in my part of the country. A “semi-custom” home will cost around $110 to $130 per square foot, and a true custom home will cost at least $140, and as much as $200 per square foot to build.
Show me the floor plan of a house, and with a few specific questions, a builder can place it within one of those ranges. That’s a start, but for a 2,500-square-foot “semi-custom” home, a range of $20 per square foot is a lot of money. You definitely don’t want your cost estimate for a $250,000 home to be $50,000 in error!
But with a little research, square foot pricing can be a useful tool. find out what Similary the cost of building houses in your area (don’t forget to figure out the cost of land first) to put your plan in an appropriate price range. Find builders who build homes in that range and ask them to put together a more detailed takeoff for you.
An experienced builder will be able to further evaluate your plan in terms of the expected level of finish, the impact of your construction site, and other factors to refine your cost estimate.
house plan size
Many things affect the cost of building a typical home, but three are important: size, complexity, and level of finish. The effect of the size of the house on the cost of construction is obvious. I don’t need to explain this in detail, do I? Bigger houses cost more. But is not pretty as simple as that
Far more important than the size of the home alone is the question of where that size goes, since the “cost per square foot” of a home varies wildly from room to room. It’s obvious that building a kitchen, complete with appliances, cabinets, countertops, plumbing fixtures, tile flooring, and other expensive finishes, will cost more “per square foot” than a bedroom, which doesn’t have much finish other than carpeting and paint.
If you downsize a home by taking space from low-cost rooms per square foot, such as bedrooms, you’ll find that you haven’t affected the overall cost of the home much. In fact, it probably won’t do much more than just increase the cost per square foot of the whole (now smaller) house, and it might not change the total cost at all.
So a smaller house, if the size difference is in cheap rooms, may not be a less expensive house.
House plan complexity
The effect of a home’s complexity on the cost to build is often misunderstood and is one of the sources of many unpleasant surprises for home plan buyers.
Simply put, a complex house is more expensive to build than a simple house. But what makes a house complex? It is primarily a function of the shape of the house and the relationship of the amount of roof and the amount of foundation to the area of the house.
Consider two typical house layouts: a two-story rectangular colonial and a French farmhouse with a first-floor master bedroom suite. Both houses are 3,000 square feet and both have the same level of finish.
The colonial house is the image of simplicity; both floors are exactly the same size and are stacked directly on top of each other. So while the entire house is 3,000 square feet, the foundation and roof are each only 1,500 square feet (I’m ignoring the garage for this example). It is efficient and easy to build.
The French county plan is the same size but less efficient; With the master bedroom suite moved from the upper to lower story, the roof area and foundation area are increased by approximately 500 square feet, but the overall size of the home remains the same at 3,000 square feet. More roof and foundation containing the same area; same size but with more wood and concrete = more cost.
Colonial houses have simple gabled roofs. In the simplest examples, the roof is made entirely of a single truss configuration. That’s a huge sigh of relief for the truss builder and framing crew – every truss is the same! And with no intersecting roofs or dormers, no framing, no flashing or valley metal to install.
But French Country design is distinguished by its more “incoherent” nature; an attractive house of this style stretches out a bit. French County roofs are generally hipped rather than gabled (hipped is more expensive) and often have a steep pitch: more lumber is required and labor to roof is more expensive.
Every angle, intersecting roof, bay window, porch, or level change adds complexity to a home. If you’re comparing two house plans, be aware of design intricacies that can make one significantly more expensive to build than the other.
Finishes and Accessories
Let’s compare two houses again, only this time they are both of them 3,000 sf Colonial. One has a fiberglass tub in the master bath (about $500) and the other has a $5000 whirlpool tub. That change adds $4,500 to the cost of the home, but more importantly, it changes the “square foot” cost of the home by almost $1.50 per square foot.
Beware: This is where homeowners are “nicked and tiny” to death. Perhaps you were quoted a base cost of $120 per square foot for your house. Add in the tub and you’re off to $121.50. Add in hardwood, granite, undermount sinks, brass hardware, and other upgrades and suddenly you’re at $140 per square foot and well over your budget.
Finishes and fixtures (flooring, cabinets, countertops, trim, etc.) account for about 30% to 40% of the cost of a home. It may only add a little to the cost of each item, but because so many items fall into this category, it’s very easy to lose control of the total cost.
If you want better finishes but are on a tight budget, do what my clients do: put the nicer stuff in the kitchen and master bath and the cheaper stuff elsewhere. More importantly, make a list of the finishes and accessories you want at the beginning of the project and stick to it.
budget slip
Budget increase is the gradual, sometimes imperceptible increase in the cost of your project as new items are added, bugs are discovered, or unusual site conditions are revealed. Budget escalation happens slowly, one decision at a time, growing and eating up your construction budget before you know it. It can affect you during the planning of a housing project, but more often it is a disease of the construction phase.
A little planning, patience, and foresight can help prevent this.
On any project, start with a clear idea of the level of finish and quality you expect. Don’t assume your builder is on board with his ideas about finishes: discuss your expectations in detail and, when possible, see the actual finishes and fixtures. If you’re not the detail-oriented type, hire a professional interior designer.
Poor quality drawings cause additional unplanned work during construction and always end up costing homeowners money and time. My company has been contracted many times to correct drawings made elsewhere that contained glaring errors, omitted necessary structural steel, or simply didn’t work. Sloppy drawings are an open invitation to Project Creep.
Finally, always have realistic expectations about your project budget and communicate that budget to your builder. When everyone understands the financial objectives of the project, the chances of success are greatly increased.