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PODCAST 7 - How Much Will My New Home Cost-to-Build


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Transcript of Build Your Dream Home Podcast - Episode 7:

Mark Mathis:

This is a Build Your Dream Home podcast with Mark Mathis, Episode 7.

Announcer:

Always wanted to build your dream house, but not sure where to start? You're in the right place. Welcome to the Build Your Dream Home podcast where experts in the industry share their knowledge and help you to be one step closer to building your dream home. Here's your host, Mark Mathis.

Mark Mathis:

Hello, hello. This is Mark Mathis from houseplangallery.com and the Build Your Dream Home podcast. I really appreciate you taking the time to listen to this brand new episode of the Build Your Dream Home podcast.

In today's episode, we're going to be talking about how to determine how much to build a house. This is one of the most important things that you'll need to know before you start the process. It's one of our most frequently asked questions is “how do I determine how much this house is going to cost before I actually buy house plans or actually start interacting with contractors and builders and things like that?” We're going to be going through all of those things in this episode right here.

Now if you've not already done so, you'll definitely want to go over to our website at houseplangallery.com/dreamhome and pick up our Dream Home Success Kit. This has got everything that you need to know about your new house plans and building a new home. You'll get access to special reports, special downloads, webinars that we've recorded before. You'll get access to audio recordings, our Cost-to-Build Estimator tool, just a lot of things and it's all free. So it's just out there to help you become more educated on the entire process because I know building a new home can be very overwhelming for new people, especially if you've not done it before or had a parent or family member that's gone through it before. It can be confusing and you can have a lot of questions.

Our whole intention in putting the Dream Home Success Kit together is for you to be able to be educated and feel comfortable about the process because we know how important of a process this is. This allows us to put everything together in a nice, easy-to-follow manner. Basically what happens is when you add your email address, then you'll get emails every few days with additional parts of the Dream Home Success Kit. We found that that allows you to really go through the material better and be able to absorb it. Then if you have any questions, we're always here to help you with those questions.

But another item first, we want to just have a shout-out to one of our podcast viewers. They left a review for us on iTunes and again you can subscribe at houseplangallery.com/subscribe. This one is from The Captain Blood. It says, "Loving it, really enjoying the content. Mark is very easy to listen to and makes the entire homebuilding process sound very doable. I hope to build my own home for my family soon and we'll be using this info in this podcast. Also, highly recommended."

Announcer:

Looking for the latest cool home ideas and pictures of awesome new house features that you can include in your new home? Check out our Facebook page at http://www.houseplangallery.com/facebook where every single week we'll share the new home ideas you will fall in love with.

Mark Mathis:

What we're going to do now is go right into the information. I know that your time is valuable, so I want to get into how exactly to determine cost of building a home. There's a few different items that you want to consider and I'm going to try give you a lay of the land so you're knowledgeable.

First of all, it's very important, obviously, to know the cost to build a house because you need to know how much you can actually qualify for. If you're trying to build a house that you can't qualify for through a conventional mortgage, which is what most people do, then that's something that you need to really consider. You need to determine if you need to buy a smaller house plan or just cut out some of the features that you're planning on building.

Next, you need to know that the cost to build is totally dependent on where you live and where you're planning on actually building the structure. This is due to a lot of different factors. For example, in the Northeastern United States, you have a lot of unions and trade unions that will actually be doing all the labor and the construction of your home in most cases. That's not the case everywhere, but if you did have a union situation, in many cases, that might increase the price of your labor.

You also have situations where the materials cost varies greatly over the course of the year, so depending on what time of year you're actually building that, the pricing for those types of materials like concrete and wood might be higher in certain times of the year versus other times.

Also, the geography of where you're actually building the home may be affected by materials prices. For example, pine wood is very prevalent in the Southeastern United States because it's grown everywhere and doesn't need to be transported very far at all.  However, it might be more costly in the Northeastern United States or out in California where that type of wood is not as prevalent. So that's something to consider when you're actually looking at the cost to build. It's going to vary greatly on exactly where you're building the home.

Next, a local builder takeoff is the absolute best and most accurate way to determine the actual cost to build. What they do is they go out to their subcontractors and they have a set of plans that they go by. Typically, our clients will buy a five set or even a one-set package set and we always allow them to upgrade from a one-set package, which is not for construction.

The one-set package basically allows you to have a full set of plans that builders can then use to do accurate takeoffs on every area of your house and for every trade. They're going to know the cost of the local materials or at least be able to get price quotes that are going to be applicable to your particular area. That's just a great way to go about getting that cost-to-build estimate in place.

Next, you'll find that some lumberyards like your Home Depot’s, your Lowe's, and 84 Lumber, those types of places, they can many times do your materials take-off for free. All you need to provide them with is a set of plans that's detailed enough because they want to, obviously, sell you the materials. Now that's not the case in all places that you'll go, however, you'll be able to probably find someone that will be able to do that. But to do that, they're either going to need number one, a set of plans, which they definitely should have and/or number two, a materials list ideally from the designer.

Many designers, including House Plan Gallery, will sell materials list documents for all of our plans. That's basically where we've gone through and we've laid out the specific quantity and types of materials that are needed to build a particular house plan. Now this saves you a lot of time and money because everything's already done.

All you have to do is just hand that to your builder or hand that to your local lumberyard and they can use that information to actually price that out based on where you're actually living in the country. That's a very important benefit. That's something that you'll definitely want to check out when you get ready to purchase your plans because it's going to save you a tremendous amount of time and money and it's very inexpensive to get started with. Now again, as we just spoke of, many designers offer these materials list as part of their offerings for their different house plans. Not all designers, but if you can find a designer that actually has these, it will save you a tremendous amount of time.

Now, one final note. The average cost to build a house that you'll usually come up with only includes the actual structure. So what does that mean? That means that it does not include the cost of the land. It doesn't include things like driveways, landscaping, your sod for your front yard, your mailbox, walkways. All those types of things are ancillary to the actual structure itself. This only includes the price to actually build the home, the structure itself. So keep that in mind when you're trying to figure out how much you can actually afford. If your land was actually given to you by a family member and you don't have that cost, well, then you don't have to worry about that.

However, if you've financed a mortgage for a piece of land or in some other fashion, if you still have to make payments on the actual lot itself, then that's something that you'll definitely want to include in your calculation on how much you can really afford. So if you go to https://houseplangallery.com/blogs/news/podcast-7-how-much-will-my-new-home-cost-to-build, you'll see all the show notes on this particular episode. I'm going to give you a link to check out our internal Cost-to-Build Estimator software. Now this is included as part of the Dream Home Success Kit that you'll receive. However, we keep this internal because we just use it for very quick rules-of-thumb valuations on different properties.

Basically, how it works is that you'll put in the square footage or the living or heated square footage of the house that you're looking to build. Then you'll select what part of the country that you're looking to build that in and then you'll select the finish level, so if you want high-end finishes, medium-grade or low-end, you'll be able to see a rough estimate ballpark how much that would cost to build. Now this is something again just to be used as an estimate you want. Go to your builder or local lumberyard and take them a materials list or a full set of plans to do an accurate one. But if you're just trying to get a ballpark idea, this information is based off the US Census data that was put out a few years ago and it's updated over time, so it will give you a fairly accurate idea of what you're looking at for building any particular house.

So with that, if you have any questions on anything that you've heard on this episode or any other ones, feel free to contact us at sales@houseplangallery.com. We love your comments and your feedback.  We'll definitely be glad to get back in touch with you with answers to any questions that you have.

Also, we would really appreciate it if you would go out to our podcast and subscribe and hopefully leave a review if you're liking what you're hearing. It's at houseplangallery.com/subscribe. I really appreciate it. I hope you enjoyed this information. If I can ever be of any service to you, just let us know. Until next time, have a blessed day.

Announcer:

The Build Your Dream Home podcast is brought to you by House Plan Gallery, your house plan experts. Find your dream home online at http://www.houseplangallery.com or call one of our expert home design consultants today at (601) 264-5028.