How much money will building your new custom home cost? This is a question that many people ask themselves when they are planning to build their dream house. There are so many factors involved in the process of estimating the costs of building a custom home, but it's essential that you calculate what this number would be before starting construction.
Some of the factors that can influence how much building your dream home might cost:
- Quality of Materials
- Square Footage
- Supply and Demand
Let's examine how knowing what is involved in each of these factors can help you prioritize your choices in building your dream home.
Finding the right location to build your dream home is one of the most critical factors in calculating the cost of your home. School ratings, crime rates, and proximity to other amenities are all things that affect what you pay for a property. It's also important to consider land development costs, property taxes, and fees based on the location!
Some people like having access to the downtown area. Others might be looking for more of a country feel. You need to figure out what you're looking for in terms of location and then compare the price tags on different properties in that category!
The benefit of building close to a city is that you may have access to city water and sewage, saving you money from having to install a well and septic system on your new property. However, being closer to a city may lead to more traffic and increased demand, which in turn will affect property prices.
Others opt to get out of town and spread themselves out with a bit more land. Living in the country means taking into account the distance from stores and services people might not expect. Smaller towns might be more affordable in the long run, but you also might need a bit more patience when it comes to access. Longer drives to get things you regularly need, internet speed issues, and the lack of a hip and trendy restaurant nearby on a Saturday night are all things to consider if you're moving into the country.
You must also take into consideration the site costs to prepare any lot for your new home build. These items may include tree removal, installation of well and septic, or backfill for uneven terrain, etc. You may pay a lower cost for a lot, but if it requires extensive site preparation, this could take a significant amount away from your new home budget.
The design can impact the cost of your custom home, as you consider how many stories, the complexity of the layout, roof line, and whether or not you need a basement with a walkout.
Believe it or not, the cost of a one-story home can be more per square foot than that of a two-story home. This is due to the cost of excavation and foundation work. These factors are a big percentage of the overall cost of building a home. Therefore the larger the home’s footprint is, increases the cost of labor and the materials to support the weight of the rafters and roof of a one-story home.
Aside from the number of stories, a complicated home design will cost more than a simple one. Complex designs require more engineering hours, materials, and labor to build. On the other hand, simple frame homes require fewer raw materials than extravagant ones, which means they don't significantly impact your bank account in the long term.
When it comes to building a new home, one of the most important features you should consider is the number of bedrooms and bathrooms. The more space you have in these areas will drive up your cost initially but could provide a better return on investment down the line if/when deciding to sell later.
Prioritizing your design to align with your budget means you can build the type of house you want. As you analyze your budget, our Wausau Homes builders help focus on what design features are most important to you.
3. Quality Of Materials
Many factors can contribute to the quality of your home, but if there is one thing, in particular, you should pay attention to, it’s the cost of materials. When it comes to your custom home, the quality of materials you choose can have a considerable impact on the overall cost and value of your home. Some options may be cheaper upfront but will cost more in repairs and maintenance down the line. This is an important consideration when choosing what type of material is best for your budget.
The materials that will impact your budget the most are:
- Framing Lumber
- Windows & Doors
- Cabinets & Countertops
High-end features like granite countertops, hardwood floors, custom cabinetry, and intricate trim will drive up your home’s cost. However, these high-end, durable options can increase the value of your home in the future.
Lumber prices can be unpredictable, and many factors affect the cost of construction. Fluctuations in real estate or residential building materials will likely impact your home's price at some point during its life. The type of lumber you use makes a difference.
4. Square Footage
Don't get hung up on the cost per square foot to build a house.
It can be easy for homebuyers, especially first-timers, to get caught up in how much money it costs them to build per square foot. This isn't always an accurate picture since the price to build a custom home is made up of more than just the square footage. Like we previously mentioned, the location, design, and quality of materials that go into a home need to be factored into the cost.
This is why at Wausau Homes, we use the ballpark pricing method. Our ballpark pricing method helps home buyers better understand a cost range for a home of a particular size and design. This is a more accurate way of pricing homes and allows you options to scale your home up or down to accommodate your style and budget.
However, when it comes to building a home, square footage should be a significant consideration. A larger home may require a larger lot, which in turn will increase the cost of land and development with each additional square foot of space that your new house takes up!
The size will influence your home's price, but it will also depend on other factors like amenities. Bigger custom homes are naturally more expensive than smaller ones with less square footage.
5. Supply & Demand
When demand is greater than supply, the price goes up! If an area you are looking to build is growing rapidly, it will likely cost more due to high demand. When an area has high demand, this could also drive up subcontractor costs due to the strain on the labor force. In turn, builder’s costs may increase due to the market constraints.
There is an ebb and flow to supply and demand. There are some seasons, or even decades when certain areas are "THE PLACE TO BUILD" while others could be "THE PLACE TO BAIL." Contributing factors could be:
- Crime statistics forcing people to get out of the city.
- An entire industry is shutting down, and people move to find work.
- An entire industry is starting up, and people move to find work.
- The cost of living has become prohibitively expensive.
- Tax rates have changed, and families are trying to save money.
- Certain states offer incentives to build and move.
- In times of scarcity, people want to be self-sufficient and own some land.
Every builder has its peak season. The time of year could factor into your cost of building a custom home because certain times are busier than others. Busier times create more demand which costs more money. Slower times have less need, and costs could be more economical.
At Wausau Homes, we used a proven panelized construction process to build the framework of our custom homes in our state-of-the-art, environmentally-controlled facility. This allows us to build homes all year long, including the winter months, which help maintain the best possible prices for our customers.
What about your home?
Now that you know the key factors involved in building a custom home, the question is, how much will it cost to build YOUR custom home? Over the last 60 years, Wausau Homes has built the perfect home for more than 200,000 satisfied families and counting!
Our team of builders are experts in meeting your needs for a custom build. They have the knowledge and experience to help you meet your budget and make your dream home possible!
Contact us today to talk with one of our local expert builders about designing and pricing out YOUR dream home. Don’t wait, find the builder nearest you!