Here’s How Much Money You’ll Need to Build Your Dream Home


You must really be desiring to have your own home. And it is very likely that you already have a taste – a high taste at that – but may not know how much money you’ll need to build that dream home.

Buying your home is a nice move, but building it will help you put in all the necessary consideration in place just the way it should be. You have to consider the location of the planned building, layout, floor plan, and a lot more.

Data revealed by the National Association of Realtors shows that an average sales price of a single-family home is about $300,000. Doing it yourself is likely going to be a cheaper option and also have exactly what you desire.

home interior

You should budget between $150,000 to $450,000 to have your kind of dream home – HomeAdvisor revealed. There are factors that determine the rates – square footage, region, and the materials needed in building. A cost difference in production build and custom home should also be put into consideration. Here developers would have planned subdivisions with multiple floors and lots of plans picked from.


Working with a top-level agent according to Beth Steinke, can help you with a variety of options such as finding the right lot, picking the best custom home builder, or drafting contracts with a developer. Bethe Steinke is a top-ranking real estate agent of Dall/Fort Worth Metroplex agents.


She says the expertise of a real estate agent can be really valuable when they get everything in writing.


In her words: “Whether it’s a custom home or production build, you just want to get everything in writing. This is where the expertise of a Realtor can be so valuable.”


Cost By Region 

When considering building your dream home, a factor you can never shove aside is the region your home is to be located.  “U.S. Census Bureau Survey of the Median Price per Square Foot”of new single-family homes in 2017 revealed that in the West region was $139.48, $161.53 in the Northeast, $106.79 in the Midwest, and $100.01 in the South. Hence, the Northeast region will attract the hugest cash for your home.


Steinke added that restrictions are applied, and they vary from state to state, county to county, and city to city. You should consider checking out the land rules and regulations here before you kick-off on your construction. You may also want to get a real estate agent to help you out with it.


“Having a Realtor who knows the local area mitigates your risk,” Steinke says.

You may also want to cut down costs by building in a rural area. It is however important that you consider the cost of putting in place a sewer hookup or septic system, the quantity of concrete you’ll require to reach the road, and propane for heating.

Systems that are seen as high-end or luxury such as HVAC, plumbing, and electrical can cost up to $34,000. In fact, just the HVAC can require a whopping $3,250 to $12,586 for a home that is about 2,000 square-foot, while electrical and plumbing work can be around $10,000 each. But that figure depends on the number of bathrooms in there, and how big the home is.


Considering A Developed Home vs Designing One

Having your own custom home on your ideal lot can be quite fascinating with a personalized floor plan. But then, it costs less going for a developed lot where you may still be open to having an unlived-in charm. HomeAdvisor says this can help you save about 15%.

For your floor plan, you can put up a design with the help of an architect which would cost you around $1.50 per square foot to over $2.50 per square foot or around $5,000. You may also be able to cut down on that figure by hiring a drafter instead. And that would cost you around $1,800.

The cost of labor and required materials for a custom home often take about 75% of your combined costs while the finishing, financing, land cost, landscaping, and others, would take up the remaining percent.


Expensive Taste Means A More Expensive Home

If your taste is pretty expensive, it will impact on your budget. Your interior and exterior finishes will impact greatly on your building budget.


Building Your Dream Home Foundation

Pouring your concrete foundation will cost you between $4,500 to $21,000. And with a simple slab on the lower end for a basement, the costs increase with additional excavation, materials, and reinforcement with rebar.

According to Steinke, the cost of concrete is one of the things that attract a huge budget in a house – it’s neither the counters nor the refrigerator.


Type Of Roof

When installing a new roof, you should have a budget of about $7,311. But then, prepare for more if you are considering more options that exceed the traditional asphalt.

For instance, you’ll need around $10,000 to $15,000 for energy-efficient solar panels. The figure is dependent on your location.


Finishes And Fixtures

What kind of finishes are you looking at? Are looking at marble floor tile or coveted granite countertops? These options will be accompanied by premium costs. You often required between $40 to $100 per square foot.

For hardwood flooring, you’ll require about $6 to $8 per square foot. The extras that come into your aesthetics impacts on your budget.



Key appliances would cost you between $50 to thousands of dollars for high-end options. Ensure to include your plumbing and wiring costs into your budget before building.


Extra Features

If you are considering an indoor pool, budget around $28,000. For a porch or a deck, you should have around $20,000. What about landscaping? Sod will require around $1,000. However, don’t forget to plan for upkeep for some of these extra features.


Square Footage Impacts Cost

From the projected budgeting the cost of home may be a little shift from what you were considering. However, it still depends on the materials you settle for and the region you are looking at. 2017 Construction Cost survey by the National Association of Home Builders reveals that the average cost of building a home is around $154 per square foot. And an average new-construction home is 2,776 square feet which is around $427,893.


Average costs per square-foot home:

To build a 1,000-square-foot home will cost $154,000

To build a 1,500-square-foot home will cost $231,000

To build a 2,000-square-foot home will cost $308,000

To build a 2,500-square-foot home will cost $385,000

To build a 3,000-square-foot home will cost $462,000

To build a 3,500-square-foot home will cost $539,000

To build a 4,000-square-foot home will cost$616,000

To build a 4,500-square-foot home will cost $693,000

To build a 5,000-square-foot home will cost $770,000


What Can Your Budget Afford You?

If you have a smaller budget, you may want to consider some unique options to achieving your dream-home goal. Your budget may provide any of these:


For a budget below $50,000

You may want to just have a tiny home for around $25,000 to $35,000, and you can build one for yourself for a reduced cost.

These tiny options are mobile as they sit on trailers, and average between 100 and 400 square feet. You really do not have to worry yourself with finding or renting a land to place them and meet the building codes of the location. But you’ll find them cheaper.

If you have seen homes built by Tiny Heirloom and featured on HGTV’s Tiny Luxury, you may want to consider them, harnessing higher-end materials from the earlier revealed option. That can cost you up to $150,000. But then, consider regional options also.


For a budget of $100,000 and below

Small houses of between 600 to 1,000 square feet will cost you around $60,000 to $100,000 to build. The homes are generally made up of a living space and two bedrooms or a one master bedroom. The materials needed, labor, and the cost of building in each region will determine what your budget will eventually be.


For a budget of $150,000 and below

Have you considered a pole-barn house? That is a barn-like building that has no foundation. Having shells averaging around $50 per square foot, about 2,400 square-foot pole barn and up to $120,000, with additional appliances and insulation. But with your pole barn, your projected size matters a lot in determining the eventual cost.

You may also want to consider a shipping container. With foundation, insulation, and the interior work, you’ll need around $150,000 for a large home constructed from shipping containers. It takes about 30% less time and half the price required to put up a traditional home. This means you can spend less and also move in quickly.


For a budget of $200,000 and below

A modular home – pre-assembled – will work with that budget while providing you with increased space at about $100 per square foot. It all depends on how spacious you want it.

The amount will also readily provide you with a modern home of about 1,300 square feet which equals a small two-bedroom home, and costs between $93,000 to $155,000 to build.


For a budget of $300,000 and below

This amount can fetch you a property of about 2,000 square feet. You’d have a complete 3-bedroom house sit comfortably in this budget with a cost ranging between $248,000 and $310,000. You may also consider bringing on the high-end finishes and appliances on a 2-bedroom house.


For a budget of $400,000 and below

With this budget, you can pull up a modest 4-bedroom apartment. The house would cost you about $388,000 on the lower end or a 2,500-square-foot home.

But if you are looking at the Northeast or West, your budget would be stifled into the expensive system because of the high cost of labor and land, and that amount may only fetch you a three-bedroom home.


For a budget of $500,000 and below

500k dollars will provide you with a much suitable four-bedroom home of around 3,000 square feet. This same cost will provide you a luxurious 1,500-square-foot home.  You can consider high-end appliances, hardwood floors, and granite countertops,


For a budget of $1,000,000 and below

This will provide you a 4,000-square-foot home. You may also consider a luxurious 2,500 square-foot home with aspirational flooring, appliances, cabinets, and designs.

The amount will also offer you a smaller home in highly costly regions.

Buy Or Build A Home – Which Option Is Cheaper?

Considering prominent home building options, one can affirm that it would be much more affordable buying home that is pre-existing to building a new one.

The National Association of Realtors revealed in a data that the median cost of acquiring a single-family home that is already in existence is $271,300, while the building cost is $427,893 – a figure almost double the price of the other.

And aside paying for building the home, other expenses you’ll run into includes the sewer or septic work and the land. Getting a land loan can be quite hard. Most lenders reject the loan applications because of the high risk involved. Well, except it is wrapped along with a construction loan.


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