So you’ve finally decided to build your own house – after probably living in a few rented properties and changing a few houses during your life.
On average, an individual changes three houses during his life – once when he or she starts university and moves to his ‘own’ place (a rented apartment), then buys (or moves to) a proper house right after marriage – especially when starting a family – and then the couple moves to a smaller house once all the kids have moved out.
Building a house is the single largest investment most people ever make. For many, it’s their life savings. And they want to get it right the first time – but that’s not easy when you don’t know what you need to know upfront and all of your decisions will be irreversible once the home building process begins.
Reasons People Choose To Build Their Own Houses
At the start of one’s career, a lot of people dream of someday owning a home and there could be several reasons they want their own place.
You Want To Make The ‘House Of Your Dreams’
Let’s face it, whether you rent or buy a home, there are only so many changes you can make to an existing building. You might want to have extra high ceilings, but ofcourse, you can’t do that in a house already fully built.
You might want to renovate entire portions of the house and yes, you could do it, but it’ll cost you and you might not be able to make structural changes to a house you’ve bought.
People want to build a home from scratch because they can decide how every inch of that house will be – from floor to ceiling windows to spacious, luxury bathrooms to a custom fireplace, and so on.
The freedom to build as you please is often the key motivation behind building your own house.
Much Better Construction
The problem with buying a home rather than building your own is you can’t really find out what sort of construction standards were followed (i.e what quality materials were used for building the house), and you may have spent a large sum to find out two years down the line that your roof is leaking your the wall paint is peeling off. These will obviously lead to recurring maintenance costs.
On the other hand, when you make your own house, you can choose what quality of materials are used and oversee the builders that are completing your house.
Better Value For Money
Buying a piece of land and then building on it it is usually a cheaper option than buying a house – usually 25% cheaper. You save more and several years down the line you can sell the house for a good price (considering the quality construction).
A Sense Of Achievement
Getting a house built is a major achievement and although not usually being one of the main reasons for building a house, once you start and see the house coming together piece by piece, you can’t help but feel a little proud of yourself.
It all ties up in the end with how you perceive yourself and feeling like you’ve done a major job well.
How Much Does It Cost To Build A House
So what does building a house from the ground up cost in general? We’re going to be looking at average construction costs for the U.S, and then list down costs for some major states.
Average Cost To Build A House (In the U.S)
According to HomeAdvisor, the national average cost to build a house is $283,984 with typical ranges between $117,050 and $451,632.
Very low-end options take $3500, while the very high end of the spectrum costs a cool $800,000.
House construction costs obviously depend on different factors – even if you’re building the exact same house (the same house plan), with largely the same materials in different States, both will cost differently.
Average Construction Cost By House Size
Here’s a breakdown of house construction cost by size:
| Square Feet | Average Range |
| 800 | $80,000 – $160,000 |
| 900 | $90,000 – $180,000 |
| 1000 | $100,000 – $200,000 |
| 1200 | $120,000 – $240,000 |
| 1500 | $150,000 – $300,000 |
| 1600 | $160,000 – $320,000 |
| 1800 | $180,000 – $360,000 |
| 2000 | $200,000 – $400,000 |
| 2500 | $250,000 – $500,000 |
| 2700 | $270,000 – $540,000 |
| 3000 | $300,000 – $600,000 |
| 4000 | $400,000 – $800,000 |
| 5000 | $500,000 – $1,000,000 |
Percentage Of Each Job In Total Cost
There are certain costs that take up a much larger chunk of your building expenses and some which are way less than you expected. Here’s how much each cost measures up as a percentage of the total cost:
| Work | % of Job cost | Range |
| Land & Site Work | 3% – 8% | $5,000 – $38,000 |
| Foundation | 10% – 15% | $16,600 – $72,000 |
| Framing | 10% – 20% | $16,600 – $95,000 |
| Exterior Work | 15% – 20% | $20,000 – $95,000 |
| Major Systems (electric, HVAC) | 10% – 15% | $17,000 – $72,000 |
| Interior Finishes (drywall, floors) | 25% – 35% | $42,000 – $167,000 |
Now that we have typical ranges for house construction costs in the U.S and construction costs by size, let’s take a look at the costs incurred at each stage of building your house – again, a national average (or range) is taken.
The Cost(s) For Each Step In Building Your House
This is what most people want to see when they consider building their new home; the step-by-step cost of each job gives them a realistic picture before they embark on their own home-building project.
There are three main stages and costs when you start constructing your own place:
- The Pre-Construction And Clearing Stage
- Constructing Costs (Completing Everything Except The Interiors)
- Finishing The Interiors
The Pre-Construction And Clearing Stage
This covers everything you need to do before you start building.
- Purchasing Land: Settling on a site for your house and purchasing your lot can cost $30,000-$150,000 depending on the State, location (urban or rural – rural can start from $5000), and whether utilities are already available on your site or not.
- House Plans: There are literally dozens of companies in each city offering to make you a house plan. It costs anywhere between $2000-$8000 to get a house plan finalized – depending on the size of your house site and the company you’ve chosen to make your house plan.
- Clearing And Preparing Your House Site: If you’ve purchased a plot within a housing development, the site will come prepared for building a house. If you’ve purchased a site elsewhere, you’ll to hire excavation services near to begin clearing your land. It costs between $1000 to $6000.
- Building Permit: Depending on the location of your house site and the regulations of your State, building permits can cost between $1000 to $3000.
Note: If you’re planning to demo (raze) an existing home that’s already on your site then, on average, it costs between $3,000 to $25,000 to demo an existing house (Home Advisor).
Construction Costs
Getting to the actual construction stage is where you’ll be able to see your house taking shape step-by-step, you’ll witness your taking shape in front of your eyes.
Material Costs
This is the major construction cost when you start – making for 40-50% of the total construction cost. You can lower it with the quality of building materials that you choose.
| Material Head | Cost Range |
| Lumber | $25,000 – $65,000 |
| Concrete | $1,000 – $10,000 |
| Drywall | $12 per sheet |
| Flooring | $2 – $7 per square foot |
| Siding | $2 – $15 per square foot |
| Insulation | $0.10 – $1 per square foot |
| Roofing | $1,200 – $3,500 total |
Labor Costs
Labor costs make up for 35-50% of your house’s total construction cost and it can get higher depending on your site location (city centers cost more compared to the suburbs), what cost savings your contractor is able to make (with labor) and the complexity and size of the project (thus the time taken to build it).
The longer it takes, the higher will be the labor charges.
A breakdown of average labor charges:
| Cost Head | Cost Range |
| Construction Manager Costs | $5000 – $6000 (15% of the project) |
| Electrician | $60 – $100 per hour |
| Plumber | $65 -$180 per hour |
| Roofing Costs | $4500 – $12000 |
| Framer Costs | $10 – $15 per square foot |
Foundation Costs
This cost varies based on the exact foundation needs for your home:
- Would you be adding a basement?
- Is there any need for flood protection in your area?
- Is your site near the beach and the ground is a bit soft? – so you’ll need to take measures when setting up the foundation
- Are you going to add in a basement garage?
Taking account of all these factors, foundation costs vary from $5,000 to $25,000.
Framing Costs
The framer (and the framing process) gives shape to eac room and space in your house. It is one of the most important construction processes. It costs between $20,000 to $60,000.
Major Systems (including Electrical, Plumbing, And HVAC installation)
- Plumbing: Typical range between $10,000 and $18,000.
- Electrical Wiring: Typical range between $25,000 and $35,000
- Average HVAC system cost: $2000 to $15,000
Finishing Up The Exterior (Costs)
The exterior will decide how premium or sophisticated your house looks to passersby. You don’t really need to spend a fortune here but make sure to factor in the cost (and budget for the exterior) as a portion of the entire interior cost, so at least you’ll be making an exterior worthy of your home.
Exterior finishing costs between $35,000 to $60,000, the major costs here being:
- Windows Cost: $2,500 to $7,000
- Roofing: $6000 to $12,000
- Exterior Paint Job: $2000 to $4000
Finishing The Interiors
Interior can be as modest as you want or as expensive as you desire. An average range is between $50,000 to $175,000, but can readily be higher – all the way to $400,000 for decent, high-end houses.
Here’s a breakdown of interior costs:
| Cost Head | Cost Range |
| Lighting Fixtures | $2,500 – $15,000 |
| Floor Installation | $10,000 – $40,000 |
| Appliances | $3,000 – $18,000 |
| Fireplace Installation | $2,000 – $10,000 |
| Drywall Installation | $5000 – $30,000 |
| Doors | $6000 – $20,000 |
| Interior Paint | $5000 – $12,000 |
| Cabinets | $3000 – $25,000 |
So these are all the general costs related to building a house, if you any specific needs, then those will obviously have an added costs – like a swimming pool or a complex design for your house or an indoor (glass) garden.
Now let’s briefly see what it costs to build houses in different states (on average):
House Construction Costs By State
- Florida: It costs between $240,000 to $350,000 to construct a house in Florida (ibuyer.com)
- Austin, Texas: The average cost to construct at 3000 sq ft. house in Austin is between $300,000 to $465,000 (Home Builder Digest)
- Nashville, Tennessee: It costs between $270,000 to $600,000 to build a house in Nashville (considering square foot costs from $90 to $200) for a 3000 sq. ft. house (Nashville Home Construction Cost)
- Raleigh, North Carolina: Average square feet costs run between $170 to $300, totaling $510,000 to $900,000 for constructing a 3000 sq. ft. house (Raleigh Home Construction Cost)
Conclusion
Building a house is a major project that requires careful planning – both financially and duration-wise. Before you hire home builders, it is best to chalk out a detailed budget or cost breakdown (and keep a buffer in there), so you can know what ranges you can work in and know where you can potentially save money.
Consult with professionals to minimize your risk – i.e overblowing your budget by a huge margin – you want your dream home to be a pleasure to construct, not a headache. And if you move in a systematic, step-by-step fashion, you will enjoy the ‘coming together of the place you will soon call ‘Home’.
