A new construction build is a great way to improve your property. The process can be expensive and time-consuming without significant planning and preparation. Surprise costs and delays can be massively reduced by understanding the overall project. Many people are unsure where to start. However, there are so many resources to help you get on the right track. Below, you will find helpful information on how to estimate new home construction costs.
How to Estimate New Home Construction Costs
Building a home is an exciting endeavor. Without proper planning, it can be overwhelming. This is especially true when it comes to the budget. However, there are effective ways to estimate your costs. Consider the following tips to ensure your new construction goes off without a hitch.
Cost Per Square Foot
The cost per square foot can make a huge difference in your overall construction costs. It is one of the fastest ways to get a ballpark figure of your total construction costs. Remodeling contractors can provide you with an estimate based on recent local builds. The cost depends on the region and type of materials. When you get the estimate, clarify what is included in their estimate. Some do not include soft costs, which can account for up to 25% of your total cost. Be sure the size of your project aligns with your overall budget.
Site Preparation Costs
The quality of the site that the build is on matters when it comes to cost. If the area is not fully prepared and ready, site preparation can vary significantly. If the area is wooded, sloped, or needs significant preparation, that adds to your overall costs. Grading, tree removal, soil testing, and utility trenching may be necessary. Clarify the site preparation costs in advance so you can include them in your overall budget. This includes whether utilities are connected, as it is necessary for construction operations.
Finish Level
The type of finish you choose can substantially change your construction costs. Some people mix and match by spending extra in certain areas and saving in others. If you are detail-oriented and effective at project management, this may not be a problem. Be sure to discuss this with your remodeling contractors. Alternatively, some contractors have pre-determined finish levels. Common finish levels include economy, mid-range, and high-end. Choosing a preset finish level can streamline your build if you do not have a lot of wiggle room in your budget. Common features include cabinets, countertops, lighting, and flooring. Changing the finish level mid-construction can be costly, so be sure you are prepared for what you choose. It can also impact your construction timeline.
Soft Costs
Soft costs are often overlooked and can add up very quickly. In fact, they can total anywhere from 15-25% of the total cost of construction. Soft costs include permits, engineering, city inspections, temporary utility hookups, and architectural fees. These are just some of the types of soft costs. Unlike hard costs, they are often less visible. However, they are equally important. When you get your contractor’s bid, be sure to confirm that all of the soft costs are included. This is a major factor when it comes to your bottom line for the construction project. Soft costs can often be planned, so being proactive about calculating the total costs is key.
Infrastructure and Utilities
Most people think about the costs of materials, labor, and permits. These are common costs associated with any new construction. However, infrastructure and utilities are another potential cost. They can be expensive additions that require budgeting. Common additions include a septic system, water well, water main hookup, or electrical panel upgrade. These are often critical to the overall build. When they go unaccounted for in the budget, it can be a huge surprise when the bill comes. Discuss any necessary or optional infrastructure or utility costs associated with your build with your remodeling contractors.
Emergency Costs
A construction project includes so many different variables. With everything going on simultaneously, things can easily come up. This may include issues with materials, price hikes, delays, or scope changes. You can plan so much in advance, which can help reduce the risk of emergency costs. However, not everything can be pre-planned. Because of this, set aside around 15-30% of your total budget in advance. This is super helpful if anything comes up so you are not scrambling. It also ensures that the project timeline is not disrupted as well.
Remodeling Contractors
If you want to build a new home, contact the team at Ivory Home Builders today for more information!