Building a New House: What is the Cost?

A newly constructed home is a wonderful opportunity to realize the dream of a perfect house, as you can design every single feature by yourself. However, most people struggle to make a decision because they do not fully understand the nature and the costs they will face.

The only way to determine whether it is a good option or not is to understand these numbers. And we have some interesting and relevant data to share with you.

According to the National Association of Home Builders, the average net costs of constructing a 2,776 square feet house in 2017 was $237,760. However, the total price for such a property eventually increased to $427,892 as the buyer also had to pay for the lot and finance the purchase and contractors, who also demanded their slice of cake.

The important thing to understand is that many variables affect the sum of costs, including the location, conditions, and requirements.

The following breakdown will provide you with significant insight into sources of expenditure:

Property and preparation costs

1. Site work. This stage includes initial preparation for construction and paying different fees, such as building permit fees, impact fees, water and sewer inspections, as well as required labor or professional work. The average price is $15,903.
2. Foundation, comprising of the excavation, concrete, retaining walls, and backfill. The average price is $25,671.
3. Framing the house, including trusses, sheathing, general metal sheet, and roof. The average price is $41,123.
4. Exterior: These expenditures will include facades finishes, roofing, windows, and doors. The number of windows and doors of your home will affect the cost. The average price is $33,066.
5. System installation: this includes HVAC, plumbing, and electrical work. The average price is $32,746.
6. Interior finishes: this stage will finally convert your house into a home. These costs include painting, drywall, lighting, interior trim, flooring, and fixtures. The average price is $67,939.
7. Final touches: you’re in the home stretch. This stage includes landscaping, clean-up, and additional outdoor structures. The average price is $16,591.

Other costs comprising the remaining part of the total expenditure

1. Cost of the lot
2. Financing
3. Overhead and general expenses
4. Marketing costs
5. Sales commission
6. Builder profit

The prices above reflect average costs, but the total price of the house will depend on your fantasy and desires. Project design, quality of materials and finishes, the construction company chosen – all of this will affect the final cost.

You should also include some unforeseen costs related to environmental issues, weather delays, and permitting status in your budget.

Summing it all up, it is a fact that no one can tell you the final price of constructing a home, but we hope that understanding the average costs will help you plan rationally.