How much is the cost per square foot for a new house? Great question.
Tough to answer. I've built homes for less than $80 per square foot, and for more than $130 per square foot. This article will shed some light on the question of how much it costs to build a new house, and give you some insight into how a builder figures cost per square foot. I also hope to give you some tools to help compare price per square foot between different builders.
When I get asked this question, it tells me the person asking it is trying to compare builders, or houses, and because houses aren't like cars (you can't go to 3 different builders and look at the exact same make and model), it's really difficult to do any kind of meaningful comparison. Comparing 2 different houses, with different features, sizes, and locations is difficult because the 2 houses might not have anything in common.
One thing they do have, that all houses have, is a price and a size. By dividing the price by the size, you get price per square foot, and boom! there's your yardstick. Now all you have to do is compare price per square foot and you can tell which house is the better value, right?
Oh, how I wish it were that simple. As my dad says, "let me throw the Hope Diamond in the bathtub and then let's figure the price per square foot". I just checked Wikipedia, and the Hope Diamond is valued at anywhere from $200-250 million dollars.
(The Hope Diamond)
Let's be conservative and say it's only worth $200 million. If you put it in the bathtub of a 2,000 square foot house, the value of that house would increase by $100,000 per square foot. That's a pretty high price per square foot - for that price, do you think that house should also come with a garage door opener?
That's a ridiculous example, of course, but it demonstrates the problem with comparing houses using cost per square foot.
Here are the big items that affect price per square foot. Compare these items in a house you're considering building or buying to help you compare one house to another (or one builder to another):
OK, I think you get the idea. There are quite a few items that could be the same cost in houses of very different sizes, which means cost per square foot can vary widely in two houses that have identical features. You can imagine how different light fixtures, faucets, appliances, and flooring could have a huge influence over price per square foot.
The bottom line is that the items you select to go into your new house will determine the cost, and the cost per square foot, much more than the choice of builder will.
The only way to get the exact number, rather than comparing builders by some arbitrary price per square foot, is to find the builder you like and trust, and work through the process of designing or picking a house plan, specifying the features, and adding it all up.
Here is an article I wrote some time back that you might find helpful on the topic of finding and selecting the right home builder.
For more information on the overall process of building a home on your land, download this free guide, From Raw Land to Forever Home.
A home builder for 18 years, Tim is the "son" in Turner & Son Homes. He is the CEO of the company and partners with his dad, Ben, who has been building since 1964.
The current home on our property has been in existence for over 80 years. We love our property, and made our decision to build our new house there. Turner and Son was the first company we considered and we didn't have to look any further.
The Wells family
March 9, 2016