Today we are answering the most asked question we get surrounding home building: How much does it cost per square foot to build a new home?
It's the most common question we get asked and is also an extremely loaded question. What kind of house are you planning to build? What would you like to finish it with? Without the answers to these questions, it's almost impossible to give you an accurate estimate of cost/square foot. However, I know you are in the planning stage and you just want to know some numbers! What can you get for your money? Okay, let me answer your question.
I would say between $170 - $275/ square foot. "But that's a really big range though? That means the price of the 2,000 square foot house of my dreams could range from $340,000 to $550,000!" It sure does. So let's talk about what affects the price.
#1. What kind of foundation do you want?
In the order of least to most expensive the foundation options are: Slab, crawlspace, and basement.
If you want to be at the low end of total cost of your build, you need to think seriously about a slab foundation. There are definitely a few cons to this system but it is the cheapest. Crawlspaces are more expensive than slabs but offer the benefit of “maintenance-ability”. A crawl space house will cost more per square foot than a slab house. Basements are the most expensive foundation type and will cost the most upfront. However, if you are a person looking for a good price per square foot value, a finished basement will help drive down the price/square foot. If you choose to have an unfinished basement, expect a much higher cost/square foot.
#2. What kind of house do you want to build?
What kind of shape is it? A simple rectangle? Multiple ins and outs of the foundation? Is the roof steep? Does it have a bunch of gables? Is it a two story? Does it have a finished basement? Cost/square foot is essentially talking about finished square footage. So let's do a thought experiment.
You decide to build a 1,500 square foot house on a slab. We could get this done for $350,000 ($233/square foot). Now let's say you instead add a finished basement and the build now costs $425,000. You now have 3,000 finished square feet, bringing your cost/square foot down to $141.60/square foot. Now let's say we go ahead and turn this into a two story home with a finished basement that costs $525,000. We've now gotten 4,500 square feet for $116.00/square foot! Are you picking up what I'm putting down? I've written before over the cost of home additions, and this is the same principle showing up here. It's the “costco” effect. You pay less per item when you buy in bulk.
#3. How concerned are you with energy efficiency and air tightness?
As you may, or may not, know there is a big push in the building industry right now to make our homes super well insulated and air tight. Here's the reality though, that costs money. To stay on the low end of cost per square foot, you will be looking at basic insulation strategies that have been around for a long time. Fiberglass wall insulation, blown cellulose attic insulation, uninsulated slabs. For airtightness and moisture resistance the walls would be covered with Tyvek house wrap or a similar product. The house will not be extremely airtight or super insulated. However, it will still be a comfortable house. If you are living in a 1920s-1970s built house it will be a big upgrade! If you are interested in better insulation/air tight strategies and materials like Rockwool, continuous foam, spray foam insulation, and zip system, thats great! These things will notably increase the comfort of your home and decrease energy consumption. However, they do add significantly to the cost per square foot. A 4'x8'x2” piece of foam board alone runs $60/sheet!
#4 What height of ceilings would you like?
Base per square foot prices would count on 8’ ceilings throughout the home. Upgrading to 9' or 10’ ceilings would likely add approximately $5-10 dollars/square foot. Vaulted ceilings will increase your cost/square foot as well. Not only are they more labor intensive but they are tricky and more expensive to insulate.
If you are doing a basement, what kind of ceiling height would you like? 8’ basement ceiling heights are typical. However, keep in mind that usually your HVAC duct work is run in the basement. This means in a finished basement you will usually have soffits that will decrease the ceiling height in some areas. For a flat ceiling with no drop downs, you can upgrade to floor truss systems or you can opt to dig the basement for 9’ tall walls. All of these things will add significantly to your cost/square foot.
#5 What kind of finishes would you like?
This is probably the first thing we think about when we think about how much a home costs. However, I will demonstrate that it doesn't affect the price/square foot as dramatically as the other factors.
Let's say the cheapest flooring you can buy and install throughout the home is $2/square foot. (Incidentally, carpet is the cheapest floor covering). You are interested in upgrading to hardwood floors that are $10/square foot. We are only swinging the cost/square foot here $8.00. Significant, yes, but nothing compared to whether you choose to finish your basement or not. Or how about the kitchen cabinets and countertops?
Let's say you want a quality cabinet and quartz countertop. Let's assume we are building a 2,000 square foot $450,000 dollar home. The cabinets and countertops run $35,000. We try and save and end up going with the cheapest cabinets and formica countertops. They total to $12,000. The price of the home changes from $225/square foot to $213.50/square foot. I’m not trying to downplay the importance of finishes in determining cost/square foot. Obviously, the saving of $11.50 per square foot is still significant. But I do want to demonstrate that type of foundation, type of house built, and insulation/building science strategies will generally affect the price more.
So, how much will my house cost per square foot?
I hope I have shown that the answer to that question is up to you! Generally speaking, smaller houses will cost more per square foot. Single story, ranch homes on slabs and crawl spaces will likely be above $200/square foot. Houses with finished basements and second stories will likely be at or possibly below the $175/square foot range.
How do your prices compare to other builders?
We are a cost plus builder. That means the cost of your home depends solely on what you choose. Through quoting and receiving bids from our subcontractors, we will determine what the actual cost of your project will be. You will pay that cost plus the cost of our project management. Management charges range from 10-25% depending on the build. Non complicated custom homes within a 30 mile radius of Chanute would be subject to a 10% management charge. The more complicated the home and the further from our base location the greater the management charges.
This cost plus model puts you in control of your build and allows you to spend your money on the things important to you. We provide a high level of transparency before and during the building process so that you can see where your dollars are being spent.
We are currently taking on new builds for 2025, if you would like to talk more or have more questions, don't hesitate to drop a comment below, email us, or give us a call! We love talking about homebuilding and are happy to help you on this journey.
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