How to Estimate Construction Costs for a New Home

The cost of building a new home doesn't have to be a mystery. Break it down into its components to estimate how much it will cost you. Factor in everything, such as labor, material and any possible license/permit fees. It's better to generous in your calculations rather than coming up short in the end.

Difficulty:

Moderate

Instructions

1. Obtain a house plan for your new home.

2. Decide what types of materials you intend to use (think of flooring, windows, roofing, the frame, siding) and get prices from supply houses.

3. Decide how many contractors you want to work with. You can hire a single firm (a general contractor) to build the entire project or you can subcontract the work out to the various trade specialists such as masons, carpenters, roofers and electricians, acting as your own general contractor.

4. Get prices from each contractor for the work required. If you're using a general contractor, this figure will be substantially equal to the total cost.

5. Add the costs quoted by contractors to the prices you obtained for materials not included in the contractors' prices to generate the total construction cost.

6. Add the costs of building permit fees, architectural fees, insurance, financing fees and legal costs to come up with the total expense of building the house.

Tips & Warnings

• The trade specialists required for most home construction are (in roughly chronological order): excavator, mason, carpenter, roofer, siding contractor, plumber, electrician, heating/AC contractor, insulator, drywall installer, finish carpenter and painter.

• Acting as your own general contractor can allow you to save considerably on construction costs, but be advised that hiring and supervising subcontractors is a difficult and tricky project. Be honest with yourself about your ability, knowledge and available time before undertaking this task.