Many people dream of building a home from the ground up although the thought of all that freedom and control over every choice in detail is a bit overwhelming. But one of the first and most common questions homeowners have for us is: how much does it cost to build a house? It depends on many factors including location, materials, labor, design, land cost, and builder skill.
Whether you’re aspiring to build in the heart of Texas or outside of the city, knowing what influences cost will help you budget for improvements wisely and make smarter decisions along the way.
National vs. Texas Home Construction Costs
Elsewhere in the nation, the average cost to build is $150 to $250 per square foot. In Texas, however, prices are far more reasonable (usually between $120 and $200 per square foot). Meaning that a 2,000-square-foot house, priced as a single-family home, could range between $240,000 and $400,000, depending on what you select.
So why the variation? Comes down to geography, what the materials cost, what labor costs and what kind of builder you’re using.
Factors That Influence Building Costs
Here are the main factors that influence how much you will spend on building a home:
1. Size and Layout
Bigger homes are more expensive not only in materials but labor and land use. Basic rectangular or square designs with little foundation work are often less expensive than bespoke designs with many stores, additional rooms or complex shapes.
2. Material Selection
From flooring and roofing to countertops and cabinetry, your materials play a big role in just how expensive your duplex will be. If you choose high-end finishes such as granite countertops, hardwood floors, or custom windows, you’ll pay more for the home.
3. Labor Costs
Workforce availability and demand are different depending on where in Texas you are. Labor costs are higher in areas where construction is booming. Therefore, it is important to work with top Texas home builders that can offer competitive pricing along with a superior quality of work.
4. Land Costs
Land is priced differently from place to place. Prices per acre (for a steady-state team, there is no appreciable difference between, say, prices that are $7,500–$17,500 per acre) Urban vs. Rural: The price per acre is generally higher for urban areas than it is for rural properties. If you don’t know where to begin, head over to our guide to where to buy land in Texas to discover the most affordable, desirable places to build a new home.
5. Permits and Fees
Don’t overlook local permit fees, inspection charges, utility hook-ups and city impact fees. These can tack thousands of dollars onto your end bill and come as a surprise to new builders.
Types of Home Builds: Custom vs. Semi-Custom
When you build a house, you typically opt for either custom, semi-custom, or production builds. Custom homes allow you the most freedom in terms of design, but come with a larger price tag.
The compromise is a Semi-Custom Home Builder where buyers can choose personalized options from pre-designed floor plans. This can save quite a bit in design and labor charges and does not prevent any creative input so it is a good deal for many Texas homeowners.
Financing the Build
One of the biggest decisions you’ll face in your home-building journey is financing. Many homeowners select construction loans, or short-term loans that cover the cost of building. And if you’re ready to get moving, our Texas construction loan builders can take you through the whole process from loan application to final walkthrough with confidence.
Already own a parcel? Or, you could offer a loan to construct a home on my land, and avoid complexity of financing by bundling land equity with the cost of construction into a single mortgage.
Choosing the Right Home Builder
A word to the wise: Your choice of builder is the one thing that will either make or break your building experience, not to mention your budget. But which do you pick?
Begin with our comprehensive guide to choosing a home builder, which covers every detail from verifying licenses and references to examining contracts and warranties. Transparency, track record, and communication always are key indicators of a trustworthy partner.
“Look for credentials, certifications, and experience.” A builder who has seen things to a similar scale and for a similar budget you are more likely to make those appointments on time without something silly like you need different frottage for the cutlery tray.
Quality Matters
The cheapest bid may sound like a good deal, but could mean a shoddy job or cheap materials, which can lead to costlier repairs later. When it comes to longevity and durability, quality should always trump savings. Work with a quality home builder that focuses on strength of structure, materials and support after the new home build.
Hidden and Additional Costs to Consider
Besides the obvious costs of construction, be sure to account for:
- Landscaping
- Driveways and sidewalks
- Fencing
- Septic systems or wells (if in rural areas)
- Furnishing and appliances
- HOA fees (if applicable)
All of these can add up and significantly impact your overall budget.
Final Thoughts
So: How much does it cost to build a house? You could spend anywhere from $240,000 to north of $500,000 depending on your vision and tastes in Texas. And it’s not just about bricks and mortar; it’s about aligning your dream with practical budgeting, financing and finding the right partners.
Whether you’re just in the initial brainstorming phase or preparing to break ground, it’s important to do your research, request multiple quotes and know your financing options. And remember: The right builder can save you time, money and aggravation.
Once you are ready to make that next step towards your dream home, we are here to help you with our Texas construction loan builders network, so you can find trusted builders who are ready to get your project going!