How much does it cost to build a home? Main Idaho Real Estate Insights

This is the most commonly asked question if you are considering building a new home- custom or semi custom.

So you want a new home. Foreclosures scare you and you can't find an existing home you really like because you know exactly what you want. Why don't you build it? How much does it cost and Is it more expensive? First lets answer the question 'is it more expensive to build a home than buy an existing one?' The answer is 'NO.' This may seem too logical but the bank would not lend money if the cost to build was more than the price to purchase an existing home! Think that through.

The next question is how much does it cost to build a home?

The Ultimate Guide to New Communities in Boise IdahoIf you want to know how much it costs to build your home, knowing now that is costs less than the purchase price, one of the easy ways to get an idea is to look at the home in a neighborhood you are intererested in. Find out the square feet in the homes and do the math. Now you know the maximum it would cost to build.

Some people want to build it themselves and builders always laugh because they know that it will cost the person more. Want to know why?

First, an experienced owner-builder is going to make two fatal flaws. One they have never built before so how do you think they are going to do at putting some 70 thousand parts together? Do you think they will make a costly mistake? Secondly, they have no relationships in the industry to know how well a company can do their job? It takes years for builders to determine who they trust to deliver what the builder expects and consistently.

Why do costs differ so much from one builder to the next?

There are basically three categories of home builders- Production, Semi Custom home builders and custom home builders. Each has its own benefits and disadvantages. Obviously production builders have the best pricing. They are buy in builk on everything from the lots to products and materials to trades and so on. Semi-Custom home builders are smaller but still have efficiencies where they can reduce costs. Part of it is based on building the same floorplan, with possibly minor modifications. A custom home builder starts from scratch on everything. The process is the same but it has to be calculated for each item and step. There are no efficiencies because each home is slightly different.

How much does it cost your builder?Boise Home Builders

Many have questioned these numbers but we have tested them numerous times and they are accurate.

Production Builder- $40 to $50 per square foot. The more square footage in the house, the lower the price

Semi Custom- $55 to $70 per square foot. Volume is a factor for the builder's costs.

Custome Home Builder- $70+ per square foot.

So your first thought maybe that that is quite the discrepoency. keep in mind these are not the same house.  You now understand also why actually working with a builder is cheaper then being your own contractor. Note: Many builders will let you build your own sweat equity. They will argue you still won't save money most of the time simply because of the time element.

So why should you build a home?

When you buy a home, you pay market value, hopefully less. No matter what the cost is the builder is going to ask for a market price. When you build, it is based on costs+.

Dare 2010 to be the best

Trey Langford

Posted by tlangford at 3/25/2010 3:25:00 PM
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Michelle Penick, Boise Idaho Real Estate Agent

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