The cost to build a new home can be broken down in several ways, but one of the greatest variables is location. Everything costs more in California and Hawaii for some reason and that includes houses. Some of the North Atlantic States are almost as expensive. In the Southeastern states, America’s heartland, and in northwestern states such as North and South Dakota, and Idaho the costs are much lower. Prices vary by as much as $50 per square foot simply because of location.

Cost to Build a New Home: Other Variables

Cost to Build a New Home: Climate
Climate differences require different types of structural variations. Northern snowy climates require a steeper roof and a deeper foundation (basement) below the frost line. Even the foundations for the deck posts have to be deeper in colder climates.

Cost to Build a New Home: Soil

Soil differences, depth of water table and climate can affect the type of foundation needed. In general deeper foundations are required in colder climates, so it makes sense to build a foundation. In areas with shallow water tables, basements are impractical unless several feet of gravel are poured in on the outside of the basement walls to allow for adequate drainage. This raises the price, and there is still a risk of basement flooding. Crawl spaces work better with clay soil. Building on a slab is generally unwise in termite prone areas or areas prone to flooding.

Cost to Build a New Home: Basements

Basements impact the average cost per square foot, because basement areas are not included in the overall square footage, but they are useful living space. They also cost more than a slab or crawl space so this skews the averages on cost per square foot.

Cost to Build a New Home: Luxury Features

Luxury features and extra features, such as hot tubs, pools, garages, stone work, tile work and genuine stone countertops drive up the price per square foot for a home. The more common these element are in a given area, the higher the average cost per square foot for that area.

Cost to Build a New Home: Material Supply and Demand

Readily available lumber and other materials keep prices low in an area. In the Southeastern and Northwestern states, where trees are grown, it is much cheaper to build a home than in areas where lumber must travel by truck or rail to the state.

Cost to Build a New Home: Inflated Prices

Inflated prices in some areas carry over to all the various building materials. In general the more affluent the population the more items cost. Even the difference between costs in small towns and large cities can be seen, and from state to state inflation rate differences are shocking.

Cost to Build a New Home: Labor Supply

Readily accessible laborers who are knowledgeable and skilled in construction make houses cost less. The more laborers are available in an area, the lower the price of their labor. Also, the more knowledgeable the general population is about construction, the less homes cost.

Cost to Build a New Home: Government Regulations

Governmental regulation and supervision impacts the price of a home. One of the great advantages of the Dakotas and many of the other Northern and Midwestern States is the lesser degree of inspection and restriction in their remote areas. The scrutiny of building inspectors, and codes were intended to improve the quality of construction, but frequently this is not the case. This is especially true in the unfair discrimination most owner builders receive in more populous areas. Inspections, rather than improve the quality of construction, frequently only serve to drive up the cost of construction, and prevent the creative use of alternative materials.

Cost to Build a New Home: Affluence

The affluence of the buyers and of people in the area. Construction often costs a lot more in affluent areas, and resort areas. Many of these differences are due to quality differences and a difference in the number and quality of luxury items and fixtures. Other differences are related to inflation in the area, and the ability of buyers to pay without question, whatever the builder charges.

Cost to Build a New Home: Knowledge

Knowledgeable buyers, accustomed to doing work themselves will frequently pay less, and get better quality work than people who know nothing about construction. It pays to study up, before building a home. For a good start on your construction knowledge, be sure to download our 98 page free book and read the articles on this site. It is also a good idea to try a few small building projects or home improvement projects of your own, before hiring a contractor to build a home for you. Just learning your way around a hardware store, becoming well versed in local pricing and experiencing the work of building can help you to get a fair price.

Cost to Build a New Home: Do-It-Yourself

The ability of buyers to assist with construction can reduce the price. In some areas people are more likely to buy shell homes or take the job of construction over, long before the appliances are delivered. The ability and willingness to do some of the work yourself can save money if the contract is written that way.

Cost to Build a New Home: Labor Cost

Labor costs vary from one area to another. Even if laborers are plentiful, inflation rates impact workers and require them to charge either more or less in order to support themselves.

What area you live in can seriously impact the cost of your home, but there are ways to save. If you live in the city you can search nearby small towns for home builders and contractors in order to keep bids lower. Buying a shell rather than a completed home is a great way to save money, provided homeowners have the skill to complete the project. Cutting back on luxury features can also reduce the price. The cost to build a home varies by area, but there are ways to reduce costs no matter where you live.

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