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The Costs of Building a Custom Home

With the current state of the economy, it has not gone unnoticed that every area has seen drastic changes in prices. The construction industry has not been immune to these challenges. The unforeseen fluctuations in price can often make a build feel challenging. Our goal is to help you have a better understanding of all the intricate details and ways that a project can be affected, so that you will feel more prepared to make the right decisions for your home.


Costs may very well be at the top of your list of potential concerns, however, with endless resources readily available, you can feel more confident in this area after a bit of budgeting and in depth planning. Here are a few things to consider as you budget for the construction of your new home:

Custom Home Methods

There are a number of ways to build a custom home, some of these methods are stick-built, system built, kit home, and modular, and they all differ greatly.

For example, a system built home can save you not only money, but also time on your build. One type of system built home is a SIP home. SIPs (structurally insulated panels) allow builders to bypass some of the framing steps that are required when building a traditional stick-built home, by erecting the pre-manufactured panels in a wall-by-wall fashion. 

The various methods not only differ in cost, they may also differ in quality/longevity, labor requirements, and projected building timeline.

There are also ways that you can be more involved with your build and save money in the process. If you know a trade such as plumbing, electricity, or drywall you can save yourself thousands with sweat equity. If you or someone you know has a knack for construction, you can decrease labor costs and can show off  your fine craftsmanship at the same time!

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Custom Home Location

If you’ve decided on the  method you’d like to use to build, your next decision may be location. Let’s shine some light on a few considerations to keep in mind for choosing potential locations to build your new system built home.

Urban and rural areas can vary significantly in costs. A few factors that contribute to the vast differences would be things such as development, HOA’s,  and lot preparedness. For example, a rural lot may be significantly cheaper than an urban one in the middle of town. The difference in pricing would come from the fact that the rural lot may need extra sewage prep, electricity, and grading, before you can start pouring your foundation. An Urban lot may have all the amenities you need to start on your home right away, but the HOA regulations may require you to change some of your desired specifications.

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Another example of this would be If your chosen lot happens to be sloped, your home may need a foundation with retaining walls. If you are building on rocky soil, there may be extra excavation costs involved. Any of the above scenarios, plus others not mentioned here  can impact your future home building budget greatly.

Custom Home Size

When building your home one big question is how big does it need to be? Considering your stage in life as well as your lifestyle, what are the things that are most important to you? There are a lot of important questions to answer when planning for how many rooms, bathrooms, etc.

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Once you’ve selected your location and your ideal square footage, it will be imperative to stay within your “building envelope”. This is the portion of the property on which you can build, think of this as imaginary lines up to which your house can be built.  What you have envisioned for your future home may be unobtainable due to things such as HOA restrictions, setbacks, easements, and overall, your budget. It can be easy to get carried away with the size of your home while ignoring the regulations that you must adhere to. Not only can a house be “too big” for the lot, there is often a minimum square footage size for homes in HOA communities.

Custom Home Design

While you’re in the process of designing your home, its size and general shape play an enormous role in the overall price of your build. As the numbers on your square footage, interior walls, levels, and ceiling height rise, so does the number on your price tag. The amount of exterior corners that are in your design will also increase the costs. For example, building a square home is more cost effective than building an ”L” shaped home. Not only do you have corners in the foundation and walls, but these affect the roof structure as well and can add significant costs.


Custom Home Interior and Exterior Finishes

It’s important to not only have the “bones” of your home decided on, but keep in mind that the finishes you choose for your home can greatly impact the budget. Whether you want butcher block countertops, or a seven foot island made with one piece of white quartz, hardwood floors or vinyl flooring, the costs will vary

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What To Do For Your Custom Home

You may be under the impression that there isn’t a secret formula to building your own home and sticking within your ideal budget, but this is simply not true. While there are a lot of factors that can change the price of a project seemingly overnight, having a thorough plan of not only what you want, but also having backup plans, are great ways to be prepared for any of those unforeseen changes that may arise. 

If you decide to work with a custom home builder, they will be able to guide your project in the direction that it needs to go while helping you stay as informed, involved and within your budget as possible.

Assessing your wants and needs for methods, location, size, design and finishes will help you not only build exactly what you envisioned for your home, but it will also help you stay within your budget.

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