Building A Custom Home? 3 Key Factors That Determine Price

In most areas, there are many homes available for sale. However, building a custom home ensures you buy the house you want and need in a location that you desire. Many people who choose to build a custom home will consider it their "dream" or "forever" home, so proper planning is important for budgeting concerns. With this guide, you will learn a few factors that help determine the cost of building your custom home.

Square Footage/Location

No matter which custom home builder you choose, the home's square footage will be a key factor in determining cost. A larger home with more square footage will cost more to build than a smaller one, but the average cost per square foot will vary according to the location.

The median price per square foot in a home is $123. So, building a 2,500 square foot home would cost around $307,500. Again, there are some variations. A home in a more desirable neighborhood will have a much higher price per square foot than the same home in a less-than-desirable neighborhood.

Also, the location and size of your lot will play a role in determining the home's total price. Multiple acres will obviously cost more than a portion of an acre unless you own the land already. Even then, you will need to run utilities through a larger plot of land, which can be expensive.

Even though there are a few other factors that affect the price, a price per square foot average is a great place to start when calculating how much your custom home will cost to build.

Basic Home Design

Another factor that affects the price of your custom home is its basic design. For example, some home styles are more difficult and time-consuming to build, which will increase time and labor costs.

A multi-level home or a home with a basement will be more difficult and more expensive to build than a single-story home without a basement even though it has the same square footage. Complicated roof lines and layouts with numerous corners and walls can also increase the cost to build your home.

Upgraded Materials

Most builders determine the price per square foot based on standard materials and features. If you are choosing to use upgraded materials, the costs will be higher.

Better-quality, energy-efficient building materials, insulation, flooring, cabinetry, tile, and wood will be more expensive than the traditional materials used. Also, a brick-and-stone exterior will cost more in materials than a home with vinyl siding.

No matter what home you build and where you build it, remember you are making an investment. This guide will help you calculate the cost of building your custom home.