When it comes to building vs buying a house, everyone has a reason for choosing one over the other because eventually, it’s about what’s right for you and your preference. For many prospective Houston homebuyers, the cost is one of the determining factors when choosing between buying or building a house. Perhaps that’s why most homebuyers spend lots of time and energy searching for the perfect home because after all, one of the very first decisions you’re most likely going to make is whether to shop for an existing home or build a new construction home.
The Cost – Building a House VS Buying a House
According to the HAR, the median sale price of an existing home in Houston is $300,000 as of September 2021. On the other hand, the total cost of building a house in Texas varies because a new construction home offers more opportunities for customization on features compared to buying an existing home. having said that, the cost of home building in Houston is currently from $91.63 – $133.95 per square foot. In the 2019 NAHB Construction Cost Survey, the average construction cost of a typical single-family home is $296,652, or about $114 per square foot. Looking back, the cost of construction per square foot was $80 in 2011, $95 in 2013, $103 in 2015, and $86 in 2017.
On average, the cost of new home construction in the U.S. typically falls between $100 and $155 per square foot, while custom and luxury options can reach $500 or more per square foot. This makes the total cost of building a house somewhere between $155,310 and $416,250 where labor makes up roughly 40% of the build cost, and the rest includes the permits, design fees, and materials.
Pre-Construction Costs
Price of pre-construction when building a house generally make up 10% to 25% of your total home building costs and this includes the following:
- Purchasing Land – $3,000 to $150,000 per lot
- House Plans – $2,000 to $8,000
- Building Permits – $1,200 and $2,000
- Clearing land – $1,500 to $5,000
- General contractor costs: 10%–20% of total project cost
- Architects cost: $125–$250 per hour
- Engineers cost: $100–$200 per hour
- Draftsperson costs: $50–$130 per hour
- Interior designer rate: $50–$200 per hour
- Landscape architect fee average: $70–$150 per hour
Home Building Material Costs
It is important to note that home building materials cost about 50% of your total build.
| Material | Cost |
|---|---|
| Lumber | $25,000 – $65,000 total |
| Concrete | $1,000 – $10,000 total |
| Drywall | $10 per sheet |
| Flooring | $1 – $5 per square foot |
| Siding | $2 – $15 per square foot |
| Insulation | $0.10 – $1 per square foot |
| Roofing | $1,000 – $3,000 total |
House Building Cost Breakdown
Included in the cost breakdown are things like:
- Building permit fees
- Land preparation
- Excavation and foundation work
- Frame construction and sheathing
- Roofing pricing
- Plumbing, electricity and HVAC
- Windows and doors
- Appliances
- Flooring
- Clean-up
| Work | Percent of Job Cost | Typical Range |
|---|---|---|
| Land & Site Work | 3% – 8% | $5,000 – $38,000 |
| Foundation | 10% – 15% | $16,600 – $72,000 |
| Framing | 10% – 20% | $16,600 – $95,000 |
| Exterior Work | 15% – 20% | $20,000 – $95,000 |
| Major Systems (electric, HVAC) | 10% – 15% | $17,000 – $72,000 |
| Interior Finishes (drywall, floors) | 25% – 35% | $42,000 – $167,000 |
Labor Cost to Build a House
Some construction labor costs (not including materials) include:
- Construction Manager costs: $3,150-$50,000 or 5%-15% of total project cost
- Framer rates: $7-$16 per square foot
- Electrician rates: $50-$100 per hour
- Plumber costs: $45-$200 per hour
- Roofing costs: $5,000-$10,000, on average
Which is Cheaper – Building a House VS Buying a House?
Ultimately, building a custom-designed dream home will cost you more than if you were to buy a new existing home built in a Houston subdivision like Silber Estates, or if you decide to work with a developer that already has floorplans to choose from. Data shows that building a home costs 20-30% more on average. However, in the long-term, it can save you money by eliminating the need for costly renovation, along with the legal fees of transferring the bond. A new home will also be more energy-efficient valuable, thanks to a more modern design and features.
Whether you end up choosing to build your dream home or a home that’s move-in ready, make sure you work with a trusted home builder with years of combined experience in residential real estate and high-end custom home design in order to deliver all the characteristics and comforts you desire.
Do you have experience building a home? If so, please share your experiences in the comments below.
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Luminous Homes provides exceptional single-family residences committed to exceeding expectations by capitalizing on over 23 years of combined experience in residential real estate and high-end custom home design. Each home we design and build is held to a higher standard of quality, ensuring that our clients move into a home that exudes superior craftsmanship, insightful design, and coveted features.
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