Homebuyers may have heard the term “cost per square foot” as an accurate measurement of the expected cost of building their new home, or a builder may advertise that they can build your home for a specific cost per square foot. The problem with such a claim is that there is no way to accurately state the true cost of a home until a lot is purchased and a final design is approved by the customer. Here is why you should not use cost per square foot as a determination of what home will fit in your budget.
The cost per square foot is the total cost of the home divided by the livable square footage. The reason it is such a fluid number is what is involved in the total cost of the home. As an example, take two 2000 square foot homes in comparison.
Home 1 — 2000 square feet of livable space with a 200 square foot open deck and a carport.
Home 2 — The same livable square footage, but the buyer opts for a 3-car garage and an 800 square foot screened lanai.
Both homes will have the same cost per square foot because the garage and lanai are not considered livable space. But the total costs for the two homes will be significantly different.
Here is another way cost per square foot can be misleading:
Home 1 — The home is finished by the builder with standard-grade finishing, trim, and paint.
Home 2 — The home is purchased, then the buyer opts for high-end finishes, custom cabinets, and premium countertops and appliances.
Both of these homes were sold at the same cost per square foot, but the second home will cost much more. Custom finishes and treatments can add as much as $40 per square foot to the cost of a home!
Noah Construction and Builders understand that homebuyers are trying to keep within a budget when building a new home, and it may be tempting to use cost per square foot as a determination of which home and even which builder to use. But be cautious of any builder claiming they can provide a new home for a specific cost; there are too many variables involved that can quickly cause the home cost to exceed your budget.
If you would like more information on how Noah Construction and Builders can help you with your new home or existing home repair or renovation, please call us at (631) 750-2837. We will always be transparent in our pricing and give you a clear understanding of the costs involved in any home design or renovation.