It’s a great time to think about starting your new home. But before you begin looking for a contractor or house plans, start here first: have a budget! Your bank will help you with this process by pre-qualifying you to borrow so much in order to build your home. Considering that most homes don’t come in completely on budget, some banks will figure in a contingency for you, but a safe rule of thumb is 10%.
Many people have come to us with a set of plans, only to find out that those plans to don’t actually fit in their budget. Talk to a couple of builders first to find out their approximate price per square foot to construct a house with average finishes. You’ll find this process eye-opening, allowing you to start looking for realistic plans that fit into your square foot budget. Only now will you be able to search for your house plans with a clear and realistic picture of what your budget is and what your house will likely cost to build.
Example: if you have a $400,000 budget and a builder tells you that their average price per square foot is $160, you are then able to build an approximately 2500 square foot house. Now, keep in mind, if you choose a house plan that is complex or difficult to build, that price would change. Remember that clearly understanding your budget is the best place to start when building. This will help your contractor understand your expectations up front and allow them to offer professional suggestions that can help your project fall within your budget numbers.
Heather Schuh
