There's something exciting about building your own house -- it's no wonder that more than 1,000,000 new residences are projected to go up this year. Still, if this thought has crossed your mind, you have also probably wondered: How much does it cost to build a house, anyway?
According to data from the National Association of Home Builders, the median price of constructing a single-family home in 2015 was $289,415, or $103 per square foot. And according to the U.S. Census, the median size of a newly built single-family house in 2015 was 2,467 square feet. That price can vary widely based on where you live, though. (Want a more targeted estimate? Go to realtor.com/local to find out the price per square foot in your area.)
So why does building a home cost so much? Let's break down the costs, shall we?
The main costs to build a house
There are a few main costs involved in the construction of a home, says Andy Stauffer, owner and president of Stauffer and Sons Construction. Sure, each home is different, but here are the biggies:
- The shell of the house, which includes walls, windows, doors, and roofing, can account for a third of the home's total cost, or $95,474.
- Interior finishes such as cabinets, flooring, and countertops can eat up another third of the budget, averaging $85,642. Use this calculator to plug in your ZIP code, exact square footage, and level of finish to come up with a general budget for various projects.
- Mechanical -- think plumbing and heating -- runs around 13%, or $37,843.
- Kitchens and bathrooms are the most expensive rooms to build, especially when the average cost for finishes like cabinets and countertops alone is $16,056. So if you're looking to save money, ask yourself whether you really need that third full bathroom, or will two plus a half-bath do?
- Architect and engineer drawings will run about $4,583.
Additional costs (not included)
Now you know the basic cost to build a home, but the expenses don't end there. Here are a few extra costs you'll need to be aware of that aren't factored into the above price:
- The cost of a plot of land to build on averages $3,020 per acre. That said, the average home is built on only 0.2 acres, so unless you want a lot of space in a highly desired neighborhood, that alone won't break the bank.
- Excavation and foundation work are by far the most variable cost when building a home, according to Morgan Franklin of Kentucky's LexHomeHub. In other words, you never know what you're going to find until you start digging -- be it bad soil or massive boulders. If excavation and foundation work goes relatively smoothly, the average cost for both is $33,447.
- You'll need a building permit, of course -- it averages $908 nationally.
- Other costs you'll incur before you hammer even one nail include land inspections ($4,191) and an impact fee, levied by the government to cover the costs a new home will incur on public services like electricity and waste removal ($1,742).
Why build a home?
That's a fair question -- particularly since you can buy an existing single-family house for a median price of $223,000, or $66,415 less than building one. You will also save yourself the headaches that inevitably come with construction.
Still, building a home does have its advantages. Everything from pipes to the heating and cooling systems will be new. That means no costly repairs in the near future -- and so a newly built home could end up costing less in the long run. Plus, of course, you get to design your home to your exact specifications. If you have very clear ideas of how you want your home to look, this blank slate could be worth every penny. (That said, designing your dream home from scratch has its challenges, too, so make sure to not make these mistakes.)
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