Build Your Own House - Cost Estimating

Build Your Own House - Cost Estimating

The true direct cost of building a house is a closely guarded secret. But, you should be able to build anywhere in the USA (March 2010) for $80.00 to $110 per sq ft.(or more) for labor & materials. This does not include General Contractor’s Profit & Overhead or land. Land varies tremendously depending on location, location, location.

The breakdown of the selling price (market value) of a house is ideally as follows:

25% material, 25% labor, 25% land cost, 12.5% builder profit, & 12.5% builder overhead.

All builders must juggle the material, labor, land & overhead costs. This is what it’s all about. If you absolutely must have a certain expensive material item or subcontractor, you have to compromise and spend less on something else. A builder does all this in the planning.

Here is a very important & valuable link to my "Cost Estimating Explained" page. It discusses the entire process of estimating, as well as using a spreadsheet to control costs.

You will notice in the typical hypothetical examples below, a spread of $30 difference per sq. ft. This is due to different types of foundations, roof pitches, quality, style, and # of, of windows and, the quality of everything else you decide to use (Until you actually get plans and start shopping, you won’t have an accurate estimate).

And on the “getting started" page, # 5 Resource, you'll find an excellent FREE cost to build calculator for Cities and States across the USA.

-You’re in charge!
-Try to keep costs as low as you can.
-That’s why you must use a spreadsheet to track category costs!
-Estimating is the #1 job for a GC. Nothing else comes close.
-To make this job easier, use a properly formatted spreadsheet. Being properly formatted makes the job easy and almost foolproof.

If you have and use Excel, here is a FREE Excel “lender friendly” formatted spreadsheet.

If you don’t have Excel, don’t know how to format Excel, then download our FREE custom-made software and Lender friendly formated spreadsheet from our spreadsheet page.

You might want to take a peek at  a web sample of our spreadsheet here. It will give you an idea how our Lender friendly formatted spreadsheets look and work.


2,000 sq. ft., simple design = $80 per sq ft = $160,000. Built on a $80,000 lot. Appraisal of $320,000 = you might save $80,000 or more.

2,200 sq ft steeper roof, 3 car garage, stone trim, etc. = $90 per sq ft = $198,000. Built on a $100,000 lot. Appraisal of $398,000 = you might save $99,000 or more.

2,400 sq ft, more glass, porch, hip roof, etc = $100 per sq ft = $240,000. Built on a $120,000 lot. Appraisal of $480,000 = you might save $120,000 or more.

2,600 sq ft, more complex design & costs = $110 per sq ft = $286,000. Built on a $143,000 lot. Appraisal of $572,000 = you might save $143,000 or more.

Here is a chart with the latest per sq ft building costs stats by region from NAHB (National Association of Homebuilders).

It provides an instant look at both the Median average cost per sq ft. and the Average cost per sq ft.

Median average cost per sq ft = 1/2 of all the homes in the survey cost more to build and 1/2 cost less.

Average cost per sq ft = total per sq ft costs of all houses built (in the survey) divided by the number of houses built.

Building costs were actually going down in most areas in 2008, 2009 and according to NAHB updates, in 2010, building costs are still going down in almost all areas.

Click on the logo to see chart:

Note: The figures in the chart above include the General Contractor's P & O, but NOT the land cost.

Below is a more detailed cost breakdown released by NAHB March, 2010

The top portion shows Sales Price Breakdown and Lot cost.

The 2nd shows that the national average cost to build a house in 2009, for labor and materials, was $81.92 per sq. ft. (2010 will probably prove lower costs). Does that encourage you to build your own house? I certainly hope so. (Of course the Land, Builder profit, overhead, financing cost, marketing & sales cost is not included in the $81.92)

From: NAHB Economics Group. Construction Cost survey 2009 (This is their most recent survey. 2010 may show lower costs)
NAHB = National Association of Home Builders

Click chart images for a larger view.

$222,511 = $81.92 per sq. ft. for all labor, materials, & services!
Total Builder profit, overhead, marketing, financing cost, and sales cost = $78,522, or 20.79% of the sales price of $377,624.
Note: If you are the Builder (Owner/Builder) you don’t have overhead nor marketing and sales expenses, so those items, are of course, part of your savings too.