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How much does it cost to build a house?

What you can expect to spend + tips on finding the right financing.

Building a new house can be a daunting experience, but the end result makes it all worth it. It’s more than understandable that combining all the features and fittings you want into the perfect home — and doing it all on a budget — can be far from easy.

At the end of the day, if you’re building your own home or an investment property, the key factor that comes into play when making decisions is cost.

Average cost to build a house

Expect to spend between $131,000 to $454,000 when you build a new home, according to Home Advisor. This averages out to around $292,000 — or $100 to $200 per square foot.

Average CostHigh CostLow Cost
$256,000$820,000+$8,000

But the exact cost will depend on a range of factors, including:

  • Site work
  • Foundation
  • Exterior finishes
  • Interior finishes
  • Framing
  • Plumbing and electrical
  • Heating and cooling
  • Clean up

Land Prep

TaskHiring a Pro*DIY*
Land leveling costs$980 – $2,960$300 – $1,260
Land excavation prices$1,440 – $5,050$80 – $3,540
Cost to clear land$1,250 – $4,440$200 – $500 (for a week of renting equipment)
Total average costs$3,760 – $7,450$580 – $5,300

Foundation and Framing

TaskHiring a Pro*DIY*
Concrete slab costs$11,200 – $22,400$4,480 – $15,680
Cost to lay foundation$4,160 – $13,500$1,670 – $9,450
Wall framing cost (for a 80-sq. ft. wall)$990 – $2,900$400 – $2,030
Major systems (plumbing, electric, HVAC)$30,000 – $75,000$5,750 – $52,500
Total average costs$46,350 – $113,800$12,300 – $79,660

Interior Finishes

TaskHiring a Pro*DIY*
Flooring installation costs$10,000 – $35,000$4,000 – $24,500
Cost to install doors$5,000 – $20,000$1,500 – $10,0000
Window installation prices$3,000 – $9,000$1,200 – $6,300
Major systems (plumbing, electric, HVAC)$30,000 – $75,000$5,750 – $27,500
Total average costs$48,000 – $139,000$12,450 – $68,300

Exterior Finishes

TaskHiring a Pro*DIY*
Cost to install roof$5,360 – $10,890$2,150 – $5,000
Siding prices$5,000 – $14,050$1,670 – $4,690
Exterior painting costs$2,000 – $4,000$500 – $1,000
Total average costs$12,360 – $18,940$4,320 – $10,690

There are also the specifics of your home. What materials are you going to use? Do you want to add a deck, porch or pool? Is there a specific layout you have envisioned? Any custom ideas or plans you have make it impossible to quote a one-size-fits-all figure.

Compare mortgage lenders

Compare top brands by home loan type, state availability and credit score. Select See rates to provide the lender with basic property and financial details for personalized rates.

Name Product Loan products offered State availability Min. credit score
SoFi
(NMLS #1121636)
SoFi
Conventional, Home equity, Refinance
Not available in: HI, MO, NM, NY, WV
620
No hidden fees, multiple loan terms, and member discounts available.
Rocket Mortgage
(NMLS #3030)
Rocket Mortgage
Conventional, Jumbo, FHA, VA, Refinance
Available in all states
620
Streamline your mortgage from quote to final payment — all from your computer or phone.
Better
(NMLS #330511)
Better
Conventional, Jumbo, FHA, Refinance
Not available in: HI, MA, MN, NV, NH, VT, VA
620
Online preapproval in minutes and no origination fees with this direct lender.
LendingTree
(NMLS #1136)
LendingTree
Conventional, Jumbo, FHA, VA, USDA, Home Equity, HELOC, Reverse, Refinance
Available in all states
620
Connect with vetted home loan lenders quickly through this online marketplace.
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Compare up to 4 providers

What other factors do I need to consider when building a house?

In addition to construction costs, you’ll also need to consider the policies of your city, the land you’re building on and local fees.

  • Land. The worksite itself is one of the most important factors in the overall cost of the home. You have to take into account if the land you’re planning to build on is flat or sloping. And after that there may be hidden costs, like large boulders found under the land that need to be cleared prior to building.
  • Location. It’s all about location, location, location. Costs can vary greatly depending on if you want to live rurally, in the suburbs or in a city. Typically cities will cost the most because these metropolitan areas are desirable places to live.
  • Fees, permits and inspection. Government regulations in the construction industry are consistently being reviewed and updated. You’ll find a slew of extra costs when getting every aspect of your home up to code.
  • Restrictive policies. There are some instances — mostly with homeowners association — where houses require specific building materials to be used or design requirements to be met. These costs will vary depending on the individual requirements.
  • One story or two. It’ll generally cost more to build a two-story home than a one-storey home as there are additional items required for construction. This includes an additional floor, stairs, scaffold and more.
  • Materials used. From brick and veneer to a lightweight siding such as weatherboard, the materials used in the construction of your home will have a big impact on the total cost.
  • Tradesperson. Hiring each type of professional — electrician, plumber, roofer and so on — play a large part in the cost of your build.
  • Your house. How many square feet will your home cover? How many bedrooms and bathrooms will it have? Will it be architecturally designed or a production home? To what standard will the home be fitted and finished — budget, standard or premium? All of these factors can make a difference of tens or even hundreds of thousands of dollars in the cost to build your home.

Choosing a contractor

The contractor you choose to complete your construction project is the next factor that can have an impact on the overall price. Builders can vary not only in the type of work they specialize in (for example, custom-built homes versus production homes), but also in how much they charge for their work. It’s essential to obtain quotes from several home builders to get an accurate idea of construction costs, as well as which contractor offers the best value for money.

Here are some important questions you should ask any prospective builder before enlisting their services:

  • Are you properly licensed?
  • Do you have insurance?
  • What is your building process and why is it like that?
  • Can you design and build a house to suit the layout of my property?
  • Do you provide regular updates on contraction progress?
  • Are the plans and design flexible?
  • Are there any completed homes you’ve built that I am able to inspect?
  • Do you have any references?

How to get an estimate for building a house

You’ve got two different routes you can take to get a ballpark figure of what you’ll spend to build your new home.

Construction cost calculators

There are a number of building cost calculators available online to help you work out your costs. While these calculators are useful to get a very rough idea of how much money to set aside for your new-home budget, they’re a long way removed from an accurate quote.

So before you use them, make sure you’re aware of any assumptions each calculator makes, and take whatever per-square-foot result you are given with a grain of salt.

Getting a custom quote

For a much clearer idea of how much it will cost to build your house, you’ll need to have detailed design and construction plans drawn up and get quotes from several builders. These will take into account all the specifics of your project, from any site requirements to the size, layout and features of the build.

Just make sure you know exactly what is included in the quote from your builder and what may cost extra. For example, site costs, carpets, driveways, landscaping and fencing are often not included in quotes but can add thousands of dollars to the overall cost.

Financing options for building a new house

If you need to borrow money to build your home, you’ll need to apply for a construction loan. These loans can be set up to allow you to purchase a vacant block of land first and then build on that land within a set time frame or to fund the construction of your home if you already own the land.

Unlike a regular mortgage, where the lender gives you access to a big lump sum when you take out the loan, a construction loan is set up a little differently. The lender calculates the total amount you’ll need to borrow to pay your builder and then allows you to access portions of this amount at specified times so you can pay your builder throughout the construction process. These loan withdrawals are known as progress draws and are a predetermined percentage of the total mortgage amount.

The lender will typically set a time frame for the construction of your house and typically only require you to make interest payments while your home is being built. Once construction is complete and the builder has been paid, you’ll start making full principal and interest repayments.

Before you can qualify for a construction loan, you’ll need to have full plans drawn up and the project professionally priced by your contractor. Some lenders may impose a slightly higher interest rate during the building process, so it’s important to compare construction loans and interest rates to find the right loan for your requirements.

Production homes vs. custom homes

Although it’s not always the case, production home builders are usually nationally owned companies that have completely streamlined their construction process. The main feature that typically attract people to use a volume builder is their extensive range of floor plans that are already priced out and cater to budgets ranging from standard to luxury.

However, when you choose a production home, every aspect of the build is typically finalized before construction starts — every single detail is set. If you’re someone who likes to improvise and change things as you go, you might be happier with a custom built home.

Custom builders are usually hands-on local contractors who pride themselves on the personal quality and uniqueness that they can bring to your home building experience. Custom homes suit people who like the idea of having some level of involvement in the home-building process — though that is completely optional.

With a custom builder, you have the freedom and flexibility to improvise and make adjustments along the way. Although many custom builders may have a range of plans available to inspire you, they generally have no problem working alongside an architect to create plans for your home.

Bottom line

From the features you want in your home to your bank balance, there are many factors you need to consider before you start building a home. Make sure to research all your options thoroughly and obtain an accurate idea of the total cost involved before construction begins. This will ensure that your new home is ready on time and, most importantly, on budget.

And when you’re ready to purchase, lenders offer special construction loans to finance your dream home.

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