How Much Does It Cost to Build A New Home?
You’ve searched far and wide for the place that you can call home, but none of the houses you seen so far seem to feel right. So now you’re curious, “How much does it cost to build a home?” Well, leaning on over 70 years of home building experience, we’ll go over some of the most common new home construction costs in this article and discuss whether it is cheaper to buy or build a house.
What are New Construction Costs?
To start, if you’re trying to figure out how much it costs to build a home, there are a few things you’ll want to consider. The first one is whether you want to take a truly DIY approach to building a new home, or if you want to work with professional home builders. Once you have determined how you want to approach building your new home, its time to evaluate some of the costs to build a home.
Building a New Home- Overall Costs
While the overall cost of a home varies dramatically, there are a few categories of costs you should consider when evaluating building a home. This includes:
- Cost of Land
- Cost of Labor
- Cost of Materials
Building a New Home—Cost of Land
One of the first major expenditures of building a new home is the cost of the land. This new home construction cost can vary depending on whether you are building your home or if you are working with professionals.
When you decide to build a home on your own, land costs can be seen as separate from other new home construction costs and can vary drastically based on location and size. A good estimate, however, for purchasing land for your new home is to set aside at least $3,000 and be prepared to pay over $150,000 for a suitable lot. If you already own the land you are looking to build on, this can be a major benefit, and can drastically reduce your overall costs.
If you decide to build a new construction home with a home builder, the cost of land is often built into the base price of the home. So, rather than being a separate expenditure, it is often included. That said, depending on the lot that you select, its location and size, you may see some additional costs. These “land options” charges can vary from community to community, and can range from $10,000, upwards.
Building a New Home—Cost of Labor
Outside of the cost of land, there is also a cost of labor to consider when building a new home. Similar to land, how much it cost to build a new house from a labor perspective will also vary depending on whether you, or professional home builders build your new home.
If you are working on your own, here are some of the costs of labor you should anticipate:
Floor plan services
While you can find plans online, you will likely still want to work with either a draftsman or an architect before building your home. A draftsman will charge less in comparison to an architect but generally offers less planning advice. For this service you should plan on spending around $1,300 for a draftsman or just under $5,000 for an architect.
Professional services
Outside of the more unskilled labor costs associated with framing and such, you should be prepared to pay for professional services like a plumber, electrician, or drywall specialist. Although a general contractor can help to secure some of these services for you, these professionals, plus the equipment that they are installing represent the major chunk of your home building costs. Combined, these costs can range between $120,000 to well over $300,000 depending on the size of the house.
Other home building costs that you will need to contend with may include additional services like general site work, framing support, cabinetries, and more. Altogether, without including the cost of the land, an average home, built by you, might cost anywhere between $150,000 - $400,000 to build.
If you decide to work with a new home builder, similar to the cost of land, the cost of labor is built into the price of your home. And, as an added benefit, when you work with a home builder, versus trying to build your home on your own, you don’t need to spend any time trying to coordinate all the moving parts of your new construction home. Instead, a dedicated field manager will take care of that.
Building a New Home—Cost of Materials
The final cost to consider when building your home is the cost of materials, and here again we see differences between working with home builders and building the home on your own.
While some materials, like wood, nails, and drywall are necessary for all new home construction, you will find that home builders can often purchase these materials for less, and as such include it in the overall purchase price of your home. When you build on your own, the costs of these materials fall on you, and can vary and fluctuate over time.
In addition to standard materials, another cost you can anticipate is the cost of fits and finishes within your home. This includes things like cabinets, countertops, flooring, and more. Here costs are driven solely by the options you select, and as such don’t differ dramatically between if you work with a home builder or build the home on your own. The biggest difference in this cost is that home builders may have more limited options for you to choose from, which could help you stay in budget.
Is it Cheaper to Buy a New Construction Home or Build a House from Scratch?
So, after walking through all of the different costs associated with new construction, you may be wondering if you are better off buying a new construction home with a home builder or trying to build a house from scratch? After running through all of the new home construction costs above, it’s clear that building a new home from scratch is more apt to fall on the more expensive side of things. In fact, according to the National Association of Home Builders, based on a survey from multiple new home builders, the average construction cost of a typical single-family home in 2019 was $296,652 for people who worked with new home builders. In comparison, recall, to build a home from scratch usually cost $150,000 to $400,000.
Why Build with Pulte?
While the costs of building a new home, and indeed the entire home building process can seem intense, if you are thinking it you would like to work with quality home builders to build your new home, you should consider Pulte Homes. Here are just a few reasons to work with us:
- Exceptional customer service experience
- 70 years of experience into the home building process
- Innovative floor plans that address our customer’s biggest concerns
- Curated options that offer you the ability to personalize without becoming overwhelmed
- Premium materials and high-level craftsmanship all backed by our industry leading 10-year limited structural warranty.
If you’re interested, you can browse our available homes online, checkout our online mortgage center to get some of your pricing questions answered, or take a look at some of our new home communities near you.
How much does it cost to build a new home? That’s a hard thing to put a price tag on, but with the right help you can learn more about your options and decide the best path forward for you and your family. If you feel overwhelmed by trying to calculate all of the home building costs, consider working with a new home builder team that can layout everything for you. This way, you can enjoy the process of personalizing your own home without all of the stress of having too many decisions to make.
Contributed to Your Home blog by Brittney Villalva
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Published 4.8.2021