One of the top questions we are asked is, “How much does it cost to build a house?” A quick comparison we like to look at is the question, “How much does a car cost?” It depends if you’re talking about a Chevy Sonic or a Maserati GranTurismo. There’s a wide price difference when talking about cars, and the same is true for building a home.
For example, let’s look at two 3,500-square-foot ranch-style homes. Each has four bedrooms, three and a half bathrooms and no finished lower level, but there are some key differences.
- Home One has a simple footprint and rooflines, vinyl windows, a nice kitchen, some masonry work and is situated on a level lot.
- Home Two has a more complicated footprint and rooflines, wood windows, a gourmet kitchen with the top-of-the-line appliances, features a full stone veneer exterior and is situated on the edge of a steep hill.
Even though the homes are the same size with the same number of bedrooms and bathrooms, it will cost more to build the second house. This is a great example of the flaws associated with “cost per square foot” budgeting. Some other variables that can come into play include home location, availability of utilities on the building site, finishes, etc.
The “cost per square foot” cost estimating model should only be used early in the design process while basing estimates on projects of similar types. This method only provides an average cost of the overall construction project. That number can be broken down further when looking at individual rooms in the home.
A bedroom may actually only cost $45 per square foot to build since it’s a large open space with plain walls and typically has carpeting. While a kitchen or bathroom can easily cost $1,000 per square foot or more to build, with typical features like cabinetry, countertops, tile, appliances, plumbing fixtures and/or additional electrical requirements.
Looking at the Initial Budget
When the initial budget comes in over a client’s price range, we often see the client looking to reduce the floor area to get the price down. Early on, we take a critical look at bids with our clients and communicate that reducing the size of expensive spaces like kitchens and bathrooms or reducing the quality of finishes will have the greatest effect on the overall budget.
Discussing budgets from the beginning, preparing and updating cost opinions throughout the design process and progressively adding more details as the design develops helps ensure the project remains on track to meet your goals.