New Home Building Budget

New Home Building Budget

From: Lesley

"Carl, My wife and I plan on Building a house in 2 years on some property we have already purchased. We were told that we could save a lot of money if we were to build it ourselves.

I have been a son of a carpenter all my life and have some knowledge of building homes, but not enough to do it on my own. We have purchased your book, “Be Your Own House Contractor" and would really like to try to do this own our own. Is there any advice as to where we need to start? Thanks"

Hi Lesley,

Since you already purchased your land, go back and determine your new home building budget. I always recommend starting with a budget, but at least you now know how much of your budget your land will be.

Go to my Getting Started page on http://byoh.com/gettingstarted.htm and you’ll find the steps to get you going in numerical order (you already completed # 4) When you come up with a budget, subtract your land cost and the balance is what you have left to build with.

Budget = cash plus the amount of money you can borrow.

For example, using $100.00 per sq. ft. for new home building costs, determine how many sq. ft. of house you can build. For example, if you have a budget of $200,000 and you spent $40,000 on the land, you have $160,000 left to build your house. Divide $160,000 by $100 and you get 1600. That’s the size of house you should start looking for.

When you find a house plan or two that you like, run them through a cost analysis on #5, “Determining building costs based on design & size”.

You don’t have to actually buy the plans to perform this analysis!

This amount of info should keep you busy for awhile.

Later on, as your new home building project progresses and you start getting actual mbuilding material and subcontractor bids and estimates, you can use a new home building budget spreadsheet. I have them available on my "Spreadsheets" page.

If you have any questions, let me know at “Ask Carl”

Carl