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Per Square Foot Cost for Home Construction
Per Square Foot Home Construction Costs are a
Function of Market Conditions, Labor Rates, Material Costs, and Government
Impact Fees
By: Mark J. Donovan
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Suffice it to say residential
construction costs have many variables and as a result it is difficult to
provide a simple answer on the cost per square foot of building a home or home
addition. However, it is the per square foot cost that is probably the best
metric for quickly evaluating a home construction contractor bid, at least in
terms of pricing.
There are many factors that must be considered in order to calculate cost per
square foot on a home construction project.
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In addition, the per square foot cost
is sometimes shown in two different ways, one with the cost of the building lot
included and one without. For the best apple-to-apple comparisons of per square
foot costs of new home construction it is best to calculate home construction
costs without the cost of the land factored in.
The actual per square foot cost formula simply involves dividing the total cost
of the home construction project by the total square feet of the project.
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For example, if a 400 square foot
home addition costs $50,000 to build, the per square foot cost for the home
addition would be $125. If on the other hand the same square foot home addition
costs $75,000 to construct, because for example the inclusion of high end
materials or a bathroom, the cost per square foot would be $187.50.
In addition, the amount of square feet to use in the per square foot cost
calculation can also be a variable. Heated living space is normally considered
the rule of thumb, however local tax assessors may also define certain
non-heated living space as finished living area.
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Per Square Foot Costs Vary with Home Construction Structure
The type of home construction also plays a major role in the per square foot
costs. For example, a two story home is cheaper to build than a single story
home with the same square footage. The reason for this is that with a large
single story ranch, for example, twice as much roof is required as a 2 story
home with the same square footage. Also, if the roof pitch is increased, the
amount of lumber and roof sheathing required goes up, which as a results raises
the cost per square foot home construction costs.
Similarly a basement remodeling project is typically much cheaper on a per
square foot cost basis than building an attached addition, as a basement
remodeling project does not involve including a new roof or exterior walls.
Other structural factors that impact the per square foot cost of home
construction include the home style, the number of jogs in the foundation, the
number of roof lines, the local required footing depth, and whether the home is
built on a slab or includes a basement.
Per Square Foot Costs Vary with Materials and Home Features
Construction material types and certain home features in the home plans also
contribute significantly to the cost per square foot of home construction. For
example door and window prices can vary widely depending upon the type specified
in the home construction plans. In addition, if the home plans include archways
and curved stair cases, per square foot construction costs can rise very
quickly. Also, vaulted ceilings can add dramatically to the cost per square foot
in new home construction.
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If a vaulted ceiling takes the place
of potential additional second story living area, while the total construction
costs remain nearly the same, the reduced square footage of finished living area
plays a major factor in the cost per square foot calculation.
Housing Market Conditions Impact Per Square Foot Home
Construction Costs
As with any industry it’s all about supply and demand economics when it comes to
home construction. If there is a tight construction labor market, expect to see
higher priced home construction bids.
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Also, the time of year plays a role in home construction costs. Home building is
best accomplished during the warmer months of the year and consequently there is
high demand for labor and materials during these times. During winter months,
there is usually less demand for home construction, consequently material and
labor costs can be cheaper. This said, it can also be more difficult to find
construction labor willing to work this time of year and breaking ground and
pouring foundations during winter months can be a challenge. |
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Overall state, regional and national economic factors also play a role in per
square foot home construction costs. An overall down economy and/or housing
market reduces home construction labor and material demands, which as a result
translates into lower market value for homes and lower new home construction
costs.
Local and Federal Government Impact Fees
Each town, city, and state assesses various impact fees for new home
construction. Fees are typically tied to the building permit process. Impact fee
costs can range from a few hundred dollars to tens of thousands of dollars
depending upon where you live and the impact the home construction has on the
local area.
In addition, the town, state or home association may have specific covenants or
restrictions on what type or size of a home or home addition can be constructed.
Setbacks and other various zoning laws may also impact the per square foot cost
for home construction. In some cases variances may need to be applied for which
adds to the total cost of the home construction project. Also, the town or state
may have temporary moratoriums on new home construction due inadequate municipal
services such as schools, police and fire services.
Other Factors in Calculating Per Square Foot Cost for Home
Construction
Liability insurances, utility connections, on-site portable toilets and
dumpsters, septic systems, wells, landscaping, driveways, decks and porches are
other items that add to the bottom line when calculating per square foot costs
for new home construction.
So as I stated earlier calculating per square foot costs for home construction
includes assessing numerous items, many of which are variable to location,
season, economic conditions and governments. This said, expect to pay somewhere
between $90 and $200 per square foot costs for new home construction, depending
upon the various factors mentioned.
Calculating Per Square foot Costs
To accurately calculate cost per square foot home construction costs ultimately
you, or your home construction contractor, will need to price out every item in
the new home construction project, both from a materials and labor installation
standpoint. To properly do this, you will need a complete set of home
construction plans and a home construction checklist. The home construction
plans should include blueprints and a complete cost breakdown of materials so
that a contractor can bid the job accurately. The home construction checklist
should include a detailed plan for defining the home construction project,
hiring a contractor(s), obtaining permits, material selection, managing the
actual construction, and calling for inspections. See my
Home Addition Bid
Sheets to learn more about home construction checklists.
To get ballpark figures on expected costs per square foot also check with local
banks and real estate agents. They can usually give you rough cost per square
foot construction costs for your local area. This way you have a reference point
for assessing home construction contractor bids for your home construction
project.
How to Finance your Room Addition Project -
can help provide funds for your new home improvement project if financing is
required.
Related Per Square Foot Cost for Home Construction Articles
Additional Home Construction Resources from Amazon.com
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