A starting point to figure the cost of building a new home is $100 per square foot. This does not include the price of the land. In order to figure the actual cost per square foot, a homeowner must add in all costs of construction, special amenities such as stone fireplaces and hot tubs, legal fees, land and land preparation. This overall cost must then be divided by the number of square feet in the home. The average size of a new home is 2,000 square feet.
Economizing can trim a building budget
Smaller Budgets Can Suffice
Homeowners who already own their property and desire few amenities, such as high-end cabinetry and granite countertops, may actually build a home for as little as $80 per square foot. A 2,000-square-foot home in some circumstances can be built for $160,000. In certain situations, some materials, such as lumber or stone, may be utilized from existing property. Depending on the lender's requirements, some home building may be done with recycled or used materials salvaged from another home.
Average Budgets of Mainstream Homes
Typically, excluding the price of land, a new home will cost $200,000 for 2,000 square feet. Special needs for structural requirements in highly active seismic zones or cold climates can drive up the price. A brick exterior can substantially increase the price as well. Smart homeowners can build homes with high-quality structuring and add cosmetic-only beautification over the years. For example, a linoleum kitchen floor can easily be tiled or replaced with wood flooring in the future.
Family's Budget Determines the Ballpark
To begin planning the building of a home, start with what your family can afford. Make sure the monthly mortgage payments are reasonable. Then, using that budget, plan accordingly. The basic starting point of a new home is the building site, which will largely determine the value of the home, and the type of home a family desires to construct. Staying within the parameters of what one's family can afford helps shape the viability of the project.
Dangers of Going Over Budget
Some homeowners have gone bankrupt while working with unscrupulous contractors in building a home. A builder's fees are typically 15% to 20% of the cost of the home. Failing to figure in all costs and neglecting to plan for unforeseen costs can derail a dream. Every homeowner should consult with several experts and trusted friends while planning to build a home. Keep track of all financial transactions and receipts during the home-building process.
Reputation of a General Contractor
Creating very exacting plans and budgets will protect a homeowner, with few surprises, if a family works with a general contractor who is well-respected and has an extensive list of satisfied clients in a city or area. A home's cost should never exceed the designated budget by more than 15% as the project unfolds. Credible contractors guide all labor and materials purchases and keep the cost on target.
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