Factors That Affect the Cost to Build a New Home

home interior

Building a new home is always going to be an expensive proposition. While there are some things that can help bring down the price, you’re almost always going to pay top dollar for new construction. These factors determine how much it costs to build a house:


New Home

Generally speaking, land tends to be cheaper in rural areas. The further from a city you get, the less expensive it will be to build a house on your property. This is because there are fewer people looking to buy homes and developers building new construction homes. However, this isn’t always the case. Property values can vary greatly between two different cities that are only an hour away from one another, so it pays to do some research into what houses in your area are going for.

Size of the Property

New Home

The larger your lot size, the larger home you can build- which means more value for your dollar spent on construction costs. As a result, if you have a large lot available for construction you will likely pay more per square foot for your home than someone whose lot is smaller.

DIY or Hire Pros

Doing it yourself construction projects will save you money, but most people aren’t skilled enough to work on their own homes without causing more problems than they solve. Unless you’re an experienced builder who can manage the entire process yourself, you’ll end up spending more in the long run when trying to do everything yourself. Save money by hiring out when possible and doing all of the finished work like painting and landscaping yourself.

The Type of Foundation You Choose

Generally speaking, a traditional foundation is less expensive than a slab foundation in most parts of North America (a pier & beam foundation will be very different). However, this isn’t always the case. Slab foundations are often preferable in areas that have a very wet climate. If you live near a swamp or in an area where the water table is high, this is something to consider when building your home.

The Building Materials You Choose

As with most things in life, you get what you pay for and that’s certainly true of building materials as well! Cheaper construction materials will cost less initially but tend to break down faster than higher-quality choices, which means more money spent on replacements and repairs just a few years later. On the other hand, investing in better quality materials will mean that your house holds its value longer and requires fewer repairs overall.

Size of the Home

The larger your home is, the more it will cost to build. This is because there are more materials being used in construction and because bigger homes often have multiple stories which means workers must use the right equipment in order to complete their work safely.

The Number of Stories You Need

The same logic that applies when deciding whether your new home needs just one story or multiple levels also applies to how much it costs to build a house. If you need two stories, expect this addition to driving up the price of construction- sometimes rather significantly depending on where you’re building and what kind of foundation you’re using.

Specialized Construction Requirements

If you want special features such as expansive vaulted ceilings (great for cathedral-like rooms), then these construction requirements also come with a price. If you want a pool or spa or other unique features, this will likely drive up your total construction costs as well.


As you can see, there are a number of factors that affect how much it costs to have a house built. Carefully consider what your needs and wants are so that you can get the most for your construction dollar.

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