Understanding the Cost Per Square Foot to Build a House: A Comprehensive Guide for Homebuilders


Understanding the Factors Influencing the Cost Per Square Foot to Build a House

Building a house can be a dream for many households. To make this dream a reality, it is vital to consider several factors, especially the cost per square foot. This detailed guide offers insights into the costs incurred per square foot to build a house.

Breakdown of the Costs Per Square Foot in House Construction

Before delving into the specifics, it’s important to outline what a construction cost per square foot includes. Majority includes site work, permit fees, home design, interior finishes, foundation, framing, electrical, plumbing, HVAC, and appliances.

Location as the Key Driver of Costs

One major factor that affects the cost per square foot to build a house is location. The real estate market fluctuations, availability of amenities, and accessibility to infrastructure can drastically impact the cost.

Cost Per Square Foot by Region

In general, the Northeast has the highest average cost per square foot ($155+) while the South has the lowest average ($100). These numbers can vary significantly depending on specific locations within each region.

Difference in Costs: Custom builds versus Predesigned Homes

Custom homes cost more per square foot when compared with predesigned homes. The flexibility and freedom of design in custom homes add to their cost per square foot.

What Goes into Calculating the Cost Per Square Foot?

The cost per square foot for building a house is calculated by dividing the total cost of the construction by the total square footage of the house. The total cost includes not just the material cost, but also labor and other expenses.

Materials Cost

Materials account for the majority of the cost per square foot. Basic materials used in construction such as wood, steel, concrete, bricks etc., can be quite costly.

Labor Cost

Labor costs vary according to region, complexity of the job, and skill level of the workers. In general, labor costs account for approximately 30% of the total cost per square foot of building a house.

Soft Costs

Soft costs include architectural, engineering, financing, and legal fees. These costs usually represent about 10-15% of the total home building cost.

Importance of a Quality Build

During the construction of a new home, quality should never be compromised as it ensures longevity, increases the value of the property, and maximizes comfort and livability.


Understanding the cost per square foot to build a house allows a homeowner to determine the approximate cost of building their dream home. Collecting this vital information can significantly aid in budgeting and planning.

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