Finding the perfect home can be challenging. Perhaps the kitchen isn’t large enough or there are too few bathrooms. When the search becomes futile, you may be intrigued by the idea of building your own custom home. However, there’s a little bit more to it than pulling out your wish list.
Before buying your land, you’ll need to know what your costs will be to complete your new home. With, for example, residential construction costs varying anywhere between $105 to $1,000+ per square foot in the Greater Toronto Area – depending on whether you are building a more modest home or high end custom property – it’s important to have a clear idea of your must-haves and can-do-with-outs before embarking on a project. Given that this broad range only cover the hard construction costs, and does not include additional expenses for land purchasing, building design, permitting, surveys, geotechnical studies, landscaping and arborists, etc, the final cost of your project will come down to what you expect in terms of overall quality and interior and exterior finishing.
If you would like to consult with a professional on how to budget for your dream home, contact us today and we will be happy to review the specifics of your situation and project.
In the meantime, we outline in the article below some important things to consider when budgeting for building your new home.
What to Consider when Building a Custom Home
When the decision’s been finalized to build rather than buy, it’s important to prepare for how the costs will break down. Understanding the general expenditures associated with framing, land purchase, fees, and other miscellaneous costs, will assist in the overall planning and budgeting for your custom home.
Understanding the building basics will help you budget for the fun expenses, like appliances, finishes and all the extras you may be able to add to your dream home. Did someone say movie room?
The shell or frame of a house can account for approximately a third of the total cost. Framing will include your home’s walls, doors, windows, and roofing. Focusing on quality materials will ensure the durability of your home, especially during the harsher weather of the winter and summer months.
Next, you can expect all of the interior finishes to account for about another third of your custom home’s total cost. Here is where you get to decide whether you want hardwood floors, stone, carpet, or something else.
Plumbing and heating will generally account for about 13% of the budget. This is where you decide whether you would like to install central air-conditioning, what kind of heating system you would like, and so on.
Kitchens and bathrooms are the two rooms that are usually the most expensive when building a home, and are usually the most important in terms of comfort and functionality. The cost of a brand new kitchen can vary anywhere between $15,000 to $50,000+ and a new bathroom from $10,000 to $20,000+ depending on your requirements and taste.
Last, but certainly not least, the cost of hiring an architect and engineer to design and draw up blueprints and schematics must be factored into your budget planning.
The cost of the property
The cost of your estate can vary considerably, depending on where you buy, and whether you are buying a vacant lot or a developed property. If you are buying an existing home in exclusive neighbourhoods such as the Bridle Path, Rosedale or Forest Hill, the total cost will be much higher than if you buy a value property in Pleasant View.
Your required level of investment will include the initial purchase cost, but will also influence how much you then spend on the new build or renovation, as it is best to create a home that is in keeping with your neighbourhood. Ideally you should build a property that will appreciate over time and maximise your equity – spend too little and your home will end up under it’s potential value. Spend too much, and you’ll never recoup that money when it’s time to sell.
This is where the advice of an experienced builder familiar with your market becomes invaluable.
Before the first shovel hits the ground, it is strongly recommended to purchase construction insurance to protect your investment. As with anything, you never know when something will go wrong.
Inspections and Permits
The last thing you want is to be halfway through building and to find out you are missing necessary permits that will halt construction. Your general contractor or builder should take care of the inspections and permits required for your project, since they are more aware of exactly which permits are required when building a home. This is where the experience of your building team comes into play – the more experienced and professional home builders will be able to guide you through this process and handle the necessary paperwork to ensure your project can go ahead.
The cost of home inspections generally depends on the size of the home, but there is no set standard for how they are calculated. It’s always a good idea to find out ahead of time what the inspection covers and what it doesn’t.
Construction Details That Affect Cost
As you’ve probably come to realize, the cost of your custom home greatly depends on you. Your contractor, builder, and architect’s jobs are to work around your idea of what you want your home to look like. Additional details that will affect how much your home will cost include:
It makes sense to surmise that the larger the square footage, the more your home will cost. Keep that in mind when deciding whether that additional theater room is a necessity.
Number of Stories
Adding an attic or basement will do more than adding to the design cost. Structural adjustments will be necessary, which will add to the framing cost as well as the foundation and support.
When discussing roofing, the importance should be on durability and structure versus economy. You can save money by skipping custom roofing materials, such as tile. Stick with traditional asphalt for resilience and budget-friendliness. Appliances With all the high-tech appliances on the market such as refrigerators you can “see” on your smart phone and washing machines with a soaking sink, it makes sense that these expensive necessities can drain your budget. Before finalizing your budget, do your research to see how much you are willing and able to spend on appliances.
Finishes and Fixtures
To increase the look of luxury in your home, finishes, and fixtures in each room can be customized based on your taste and budget. In the kitchen, countertops can easily affect your bank account. For durability and elegance, skip Granite and look at Quartz counters. Both can cost about $40 to $100 per square foot installed.
These are the items on the “dream list” that are not necessities but would sure be nice to have. Swimming pools are an excellent example of something that not only has to be factored in as a one-time cost, but also as a monthly expense for cleaning, heat, and required maintenance.
Size, shape, finishes, and design all impact the cost of building a home. Understanding how the costs breakdown, whether a custom home is right for you and what options you have are critical for those looking to stay within budget. Use this to navigate those decisions, big and small.
Deciding whether to build a custom home is a monumental decision, and we’d be happy to help guide you through the process. For a free consultation, please fill in your contact information below and a member of our team will be in touch!