How Much Does It Cost to Build a House? Breaking Down the Expenses

Single-family home prices in 2024 surpassed record-high prices in 2022. With the median price of existing single-family homes at $418,700, according to third-quarter 2024 data from the National Association of Realtors® (NAR), it might seem cheaper to do it yourself, especially if you live in an expensive area.

Your precise cost will vary depending on factors like the region where you want to live, the square footage you have in mind, and the materials used to build. There’s also a price difference between a custom home and a production build, where developers have planned subdivisions with various lots and floor plans to choose from.

Let’s dive into the details.

Breaking down the cost of building a house

According to Chad Hackmann, regional partner at Alair Homes Arlington, it’s been his experience that people who want to build their own home tend to enjoy the process. “You build your own house because you want exactly what you want, and you want it in a certain way,” he says. Maybe the size of the windows is important to you, or you want to position the kitchen so it catches the morning sun.

Your interior and exterior finishes will greatly impact your budget when constructing your dream home.

Land: varies by location and plot size

Whether you’re buying a developed lot or untouched land, the property plays a significant role in the overall cost to build. The cost to purchase a lot varies significantly depending on the size and location of the land. It could be as little as $3,000 or as high as $150,000 – or more.

The amount of lot preparation required also needs to be calculated into your building costs, which HomeAdvisor estimates between $2,000 to $35,000. This can include expenses such as soil testing, land excavation, grading, and surveyor fees.

According to the National Association of Homebuilders (NAHB), the U.S. median lot price is $58,000, but in some parts of the country, such as the New England and Pacific areas, median lot values are much higher — $180,000 and $150,000, respectively.

Many buyers need to consider financing to cover these costs, as land loans are often separate from new construction loans. Nadia Aminov, a Baltimore, Maryland, real estate agent with 21 years of experience, was herself put off by the financing process.

“If you don’t have cash to pay for the piece of land, you have to get financing. First, you find the parcel, and you finance the purchase of the land. Then you finance the construction of the house, but these are two separate things,” Aminov explains, adding that the combination can be a complicated process.

Foundation: $9,383

The average cost to install a foundation is $9,383. While a simple slab is on the lower end, if you want to create a basement (to potentially furnish later), costs increase with more material, reinforcement with rebar, and additional excavation.

Framing: $14,000 to $32,000

Building your house into your desired shape, a process called framing, costs about $14,000 to $32,000 for a 2,000-square-foot home. Since framing typically requires wood, keep in mind that the price of lumber will impact this cost. As of February 2024, lumber price was around $565.5 per thousand board feet.

Roof: $8,500 to $14,300

On a national average, a new roof typically costs $10,000 to install. However, this estimate will go up if you want options beyond the traditional asphalt shingles or if you have a larger-than-average roof.

Thinking about adding solar panels to your new roof? Budget about $20,948 after tax credits, or you might consider a leased solar panel option.

Appliances: $5,000

Your new house will also need new appliances, like a refrigerator, dishwasher, and washer/dryer. If it’s your first time buying large appliances, it’s a good idea to check out price ranges so that you can add these items to your calculations.

Key systems: $15,527 to $42,527

It’s not as exciting as choosing countertops or paint colors, but don’t forget about the key systems your home will need. A new HVAC typically costs around $5,227. As for electricity, the average cost to wire a new home is $4 to $9 per square foot. Plumbing is another big line item. New construction plumbing costs can range from $1,500 all the way up to $17,500. For each system, your home’s total square footage will be a key factor in determining your overall costs.

Finishes and fixtures: $30,181 to $321,021

Dreaming of granite countertops for your kitchen? This high-end option will come at a premium cost ($57 to $170 per square foot). Choosing solid hardwood flooring ($7.80 per square foot) will also cost you.

The average bathtub and liner installation will cost $6,387, while a walk-in shower averages $6,641, but it can reach up to $10,000 per shower if you decide to go fancy.

Keep these aesthetics in mind when determining your budget, especially if you are concerned about resale value.

Permits and regulation: $93,870

Perhaps you’ve heard that it’s becoming more expensive to build due to sheer red tape. You’ll pay for each residential permit, from foundation to fencing and driveways to roofing, and all those permits add up. About 10% of your construction cost will be attributed to regulations around developing the lot, and the remainder will be attributed to regulations during construction. Each addition to the house can require its own permit with associated fees, and, as you can imagine, it adds up quickly.

Additional features: Varies depending on choices

Maybe you’re interested in personalizing your house? A 10-by-10 deck costs about $2,500 to $5,000, on average. Want a pool? That’ll cost, on average, $62,500. Need landscaping help? Depending on how much landscaping work your property requires, this cost can range widely, from $2,000 to $25,000 or even more.

These features also have additional upkeep costs that need to be considered, so don’t forget about those.