Most people who need a new home will agree that building a new home costs too much. It is just insanely expensive, and will land you in crushing debt for the next thirty years right? Well not necessarily. There are ways to cut corners, without sacrificing structure. Affordable housing is a new word everyone should know before hiring a contractor.
Building a New Home Costs: The Concept of Affordable Housing
In the 1960s and 1970s, principles were set forth, that could be used to produce affordable homes for everyone who needed them. Who listened? Almost no one ever heard about it. The 1980s were an age of ever increasing conformity. The prosperity of the 1990’s only resulted in more extravagance and uniformity in the industry standard of construction. Recently though, green building has been causing old traditional construction methods to be re-evaluated. The economic situation and the need for energy conservation are causing people to re-think their definition of the ideal home.
Building a New Home Costs: Price Per-Square-Foot
Traditional home construction costs between $75 and $130 per square foot. Luxury homes can exceed $300 per square foot. The simple breakdown of these costs is one third for materials, one third for labor and one third for the profit and overhead of the general contractor. This standard is fairly uniform across the market. This however, does give you ways to save!
Building a New Home Costs: Ways to Save Home Size
The overall size of your home is one of the greatest factors in determining the price. It also determines how much you will be paying for utilities in the future. Choosing a smaller more compact and efficient home may be a great way to save on the budget.
Building a New Home Costs: A Home that Grows
The build small and add on concept is generally deterred by most subdivisions, however it is a great way to build if you choose a rural lot. The idea is to build a home of approximately 500 – 600 square feet, and then add on years later, after you pay for the initial construction. This idea was very popular in the past, and in the present economy it may again become popular. This avoids a 30 year loan.
Building a New Home Costs: Shell Homes
A Shell home is a home that is turned over to the buyer, after it is framed, sided, and put under roof. It may or may not include dry wall and insulation, but overall it is the perfect solution for adept do-it-yourselfers. You will still need an electrician and a plumber, but most people can learn to install their own paint, wall paper and floor coverings. Even a drywall installation isn’t that complex.
Building a New Home Costs: Panel Homes
Insulated concrete panels, or structural insulated panels, or log panels can be erected into a shell home in one to three days. This saves a lot on labor, and panels are usually cheaper than other building materials as well. Panel homes are shell homes. You will have to finish up the job yourself.
Building a New Home Costs: Home Kits
These are not for the rank amateur, but people who have construction experience, may find this an excellent option. A home kit contains all you will need to build the shell yourself. Sometimes pieces are even pre-cut.
Building a New Home Costs: Modular Homes
Modular homes are not shell homes. They are homes built in a factory, usually including carpet, and then installed on your site over a few days. This usually provides a much more affordable home, built to the same quality, standards and level of completeness as a stick built home.
Building a New Home Costs: Alternative Green Materials
Building a home out of green materials like Ferro cement or rammed earth, may require a contractor, but usually these guys work unbelievably cheap. Some of these guys are green philosophers and artists. They take great pride in producing affordable homes. They have their passions for building green, and will give you a great deal. The only problem with alternative materials comes from bucking the established order. You may have trouble getting a building permit, and you can probably forget being able to obtain a loan based on the house. You may be able to borrow some money using something else is collateral though, or you could just save up and build with your own money. The savings are significant in most cases.
Building a New Home Costs: Fifteen year Mortgage
OK so if all this alternative talk is not your thing, you can still save a massive amount of money by building smaller than you can afford, and going with a 15 year loan. A fifteen year mortgage can save you over $100K through the course of the loan, when compared to a 30 year loan.
There are many ways to save on building costs, including alternative materials, and doing some of the work yourself. Building a new home costs a lot, but it need not cost more than you have, if you save your money, and use creativity in designing your home.