The cost of building a house per square foot varies by location, level of completion and the degree of luxury in finishing the home. There are many other factors that impact the cost but these three factors are paramount in pricing. Building the actual structure of the home is not an extremely significant variable. Building a home to a shell has much fewer cost variables than the cost of the finished structure.
In the South Eastern United States the average home costs about $80 per square foot, while in California the average cost is $130 per square foot. This does not include the lot, which is also much more expensive in California. Prices in the North East are between $100 and $130 per square foot. The prices seem to rise as you travel up the eastern seaboard, with the exception of Florida which is a little higher than the rest of the South. The differences in cost related to location have much to do with the overall cost of living and average wages in the area. The likelihood of people acting as their own contractor, completing the home from a shell, or otherwise doing the work themselves seems to drive the prices down as well.
Oddly, actual building materials impact the price very little in most cases. The difference between insulated concrete panels and stick built construction is about a dollar per square foot, and sometimes less. The entire cost of building a home from foundation to shell is about $25 per square foot, with a range of between $21 and $40 per square foot.
Considering that the finished home will cost between $80 and $130 to build on average we can see that the expense of building a shell is usually only about 25 or 30 percent of the home’s cost. Overall while there are savings to be had in building a shell, most notably used shipping containers, salvaged materials, and certain log kits, this is not the place where most of the money is spent.
Many people save money by hiring a contractor to build a shell only or to put together a kit for them. Since the shell only amounts for about 30 percent of the cost, if they do the work themselves from there, they can save a considerable amount of money. However they will need a licensed electrician and a plumber at bare minimum and perhaps a few other contractors to complete the project, plus they will have to buy cabinetry and fixtures as well as other materials. It can be a lot of work, and requires some skill, but if you have the time and the skills it’s possible to save a lot of money this way.
Shells vary so when pricing shells and shell kits be sure to find out what your shell includes. All shells include framing and exterior siding or the material itself serves as the siding, such as in the cases of log kits and insulated concrete panels. Some include windows, doors and roofing materials. A few include insulation and drywall. It is important to remember when comparing costs that insulated concrete panels by definition contain insulation, and the inside of the concrete can serve as drywall, so even though it may cost more than stick built, the cost of closed cell insulation in the walls and roof offset any savings of stick built over insulated concrete.
It may seem strange, but the shell price almost never covers the foundation. If you order a shell you must arrange for the foundation to be built and pay extra for it, over the shell price. It is however important that your foundation work be done in co-operation with those who install the shell. Have your shell builder and foundation builder communicate on the specifications.
Luxury almost always includes the finishing touches such as cabinetry, countertops, carpet grade and plumbing fixtures. Hardwood and ceramic tile also cost extra. Fireplaces are also a luxury that can increase your overall cost per square foot. Some people include outdoor swimming pools in their original construction, and this of course adds to overall cost. Hot tubs and other expensive luxury plumbing can add quite a bit to the cost. Woodwork and trim also vary in cost depending on the size and degree of detail. Luxury homes can cost over $800 per square foot, depending on the degree of luxury involved.
The cost per square foot varies also by the number of bathrooms, and the ratio of bathroom and kitchen space to the rest of the home. The bath and kitchen areas cost much more than other square footage in a bedroom or closet. Overall size of the home heavily impacts the cost of the home, and smaller houses also save on utilities. It makes sense to build a smaller home for savings both now and in the future, however be aware that simply building a home with fewer bedrooms, will not save you exactly $80 per square foot you cut out. Cost per square foot is an average, and once one gets past the shell state it depends more on the cost of floor coverings, cabinetry, fixtures and appliances than on size.
Building a smaller house is a great way to save money, but may actually make your home cost more per square foot, because not all square footage costs equally. Completing a shell can save money on the cost per square foot, but it is a lot of work, and requires skill in order to get a satisfactory result. Keeping an eye towards the budget when selecting cabinets, countertops and plumbing fixtures can save money on the cost of building a house per square foot. For more information download our 98 page book and read our many other articles on the subject.