A new custom home is great; you get to design it the way you want it, everything is brand new, and you know that everything is done your way. The big question, though, is how much does it cost?
That is a very complicated question. With so many varying choices, amenities, and upgrade options, it can be difficult to discern just how much you will be spending. Take a look at the some of the costs you might expect:
- Home – A home with your average upgrades such as heat pump, granite counter tops, and full basement typically costs around $120-$130 per square foot of living space right now. Upgrades, home style, and products can make this price jump all over the board, though.
- Site Costs – Site costs include excavation, storm water management, septic systems, well, engineering, and permitting. Usually one of the most frustrating items for someone looking to build a new home. This is probably the most unpredictable cost that is encountered. For a small lot with public water and sewer, this cost can be as little as $15,000-$20,000. For larger lots, however this can be as high as $70,000 or more, depending on what the township requires.
- Financing – financing costs for new home construction are typically higher than your average home purchase mortgage. Multiple inspections, special requirements from title insurances, and overall risk of new home construction drives lending costs higher – expect to pay a couple thousand more in fees than you would in a typical mortgage.
- Taxes – It’s unfortunate, but taxes on a brand new home are typically higher than an existing one. Location is a huge factor, but expect to pay a bit more than your neighbors who have been living there for 20 years.