The Cost of House-Building Materials


Building a house affords homeowners the opportunity to choose a home style that best suits their needs and select colors, flooring and cabinets that showcase their sense of style. A large portion of the expense related to having this advantage is the cost of house-building materials. Knowing some ins and outs of the construction industry can save you money on materials and help you make cost-effective decisions.

Fluctuating Prices

  • Construction material prices fluctuate frequently, often weekly and, sometimes, even daily, due to the supply and demand of specific materials. Common factors that drive the cost of materials include natural disasters, government regulations on specific materials and building booms. Most of the time, but not always, prices go up.

Material Price Lock-In

  • Most lumberyards allow contractors, and some homeowners, to “lock-in” on current material prices for a specified period. If a lumberyard offers this service, you can agree to purchase materials at today’s prices if you’re sure you want them. This can save you money, but it also obligates you to buy those materials, because the lumberyard is ordering them before the price increases. Lock-in periods typically range from a couple of weeks to a couple of months, depending upon the lumberyard’s policy.

Bids and Allowances

  • Your contractor may submit a construction bid that includes allowing you to choose some of the materials, such as flooring and fixtures, but only within a specified price range. The contractor does this to allow you to select the finishing materials you like, while protecting his bid price. For instance, if your contract allows you to spend up to $3,000 on carpeting but you select carpet that is more expensive, you will have to pay the additional expense out of your pocket. Standard allowances include choice of flooring, fixtures, faucets, towel bars and cabinet styles.

Change Orders

  • Change orders can greatly affect the cost of the project. A change order in construction materials may end up costing you much more than just the difference in material prices. A contractor may charge a fee for making the change. For instance, if the original contract specified carpeting and you want to change the flooring to ceramic tile, the contractor may have to adapt the subfloor, reschedule subcontractors or make other allowances to accommodate the change. Some contractors attach large fees to change orders, usually to discourage the homeowner from seeking them indiscriminately. Before you sign a home-building contract, make sure you know what the contractor’s change order policy is.

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