How Much Does It Cost to Build a House?

If you’re planning to build your dream home, one question is likely at the top of your list: How much does it cost to build a house? Unfortunately, there isn’t a single number that applies to every project. Home building costs vary based on where you’re building, the house plan you choose, local labor and material prices and the finishes you select.

That’s why looking beyond the average cost to build a house can give you a clearer picture of what to expect. Understanding the major expenses involved can also help you create a realistic home building budget before construction begins.

How to Estimate Home Construction Costs

New home construction costs cover much more than lumber and labor. While every project is different, a typical construction cost breakdown is as follows:

• Site preparation and excavation
• Foundation and framing
• Roofing, windows and exterior finishes
• Plumbing, electrical and HVAC systems
• Insulation and drywall
• Flooring, cabinetry and countertops
• Fixtures and appliances
• Labor and contractor costs
• Permits and inspections

Your property may introduce additional expenses, too. Clearing trees, grading the lot, removing rock or addressing challenging soil conditions can affect the house construction cost before the foundation is even poured. Utilities, driveways and landscaping may also need to be factored into the overall budget. Additionally, consider homeowners association dues, insurance and taxes. Read more about Building Lot Costs here.

Why Location Makes a Difference

Your ZIP code can have a major impact on the cost to build a house. Labor costs to build a home and the materials cost to build a house vary by region, as do permitting requirements and building codes. That’s one reason the average cost per square foot to build a house should be viewed as a starting point rather than a final financial plan. Even within the same state, construction costs can differ significantly from one market to another.

The home’s design also matters. A simple footprint and roofline may cost less to construct than a similarly sized home with multiple gables, bump-outs or elaborate architectural details. That’s why a personalized estimate that accounts for both your location and specific house plan can provide a more useful starting point than national averages.

How Finish Selections Affect Your Budget

One of the biggest variables in new construction costs is the level of finishes you choose. Two homeowners can build the same floor plan and end up with very different totals. A more budget-conscious finish package might include stock cabinetry, laminate countertops and standard flooring and fixtures. Upgrading could mean semi-custom cabinets, quartz countertops, hardwood flooring and higher-end fixtures. At the custom level, selections might be comprised of custom cabinetry, premium hardwoods, luxury appliances, specialty tile and high-end windows.

Deciding where to splurge and where to save early in the process is an important part of how to budget for building a house. It’s also wise to have a plan and try to stick with it because late changes can cost you big.

Does Knowing Square Footage Help?

Looking at the cost to build a house per square foot can be useful for early planning, but that calculation only tells part of the story. For example, a 1,500-square-foot home with a simple footprint and standard finishes could have very different costs from one with a complex roof, luxury kitchen and extensive outdoor living areas. Square footage is useful for comparing plans, but accurate cost estimates for building a house should also account for location, architectural complexity and finish level.

Don’t Forget the Cost of Your House Plan

The house plan itself is another line item to include in your budget. Pricing varies depending on the design, plan package and any modifications you request. Purchasing a professionally designed stock house plan can offer significant savings compared with commissioning a fully custom design while still providing a wide range of choices in architectural style, layout and features.

Is It Cheaper to Buy or Build a House?

The answer depends on your local real estate market, land prices, construction costs and what you want in a home. Buying may offer greater certainty about the purchase price and a faster move-in timeline. Building gives you more control over the floor plan, finishes and features, and may reduce the need for renovations after moving in.

Estimate Your Home Building Costs

Ultimately, the best answer to “How much does it cost to build a home?” isn’t a national average. It’s an estimate based on the home you want, where you’re building and the choices you make along the way. Check out this video with our partner, Startbuild, who explains the Cost To Build Report. Which helps provide you with a more accurate breakdown of your ZIP code, including the cost of materials in your area.

While a home building calculator can provide a helpful starting point, America’s Best House Plans’ Cost to Build Report goes further by factoring in your selected house plan, building location and material choices to give you a clearer picture of your potential construction costs. Look for it on the plan detail page of the house plan you select. Once purchased, you’ll have 30 days to adjust the report, making it easy to see how different material and finish selections can affect your estimated costs.