Overview
Building your own home is a challenging, yet very rewarding endeavor. It requires determination, discipline, solid budgeting and a commitment to the project. Determining the cost for construction can be a good way to begin thinking about designing a custom home.
Significance
Do your best to determine how much you are willing to spend (or borrow) to complete your project. This is significant because it will ultimately determine your average cost per square foot. For example, if you want gold-plated sinks and toilet bowls and a marble garage, your cost per square foot will be much higher than if you have more traditional appliances and construction materials.
Identification
In calculating your cost per square foot, decide first on financing. Take the sum of all resources and divide by the estimate square footage. For example, if you intend to spend $50,000 of your own money and take out a $200,000 construction loan from a bank, and you expect your house to be 2,500 square feet, your cost per square foot is $100. Note that this is not the actual cost per square foot, but it will put you in the correct range.
Considerations
Prepare for unseen costs when building a home. It is important to overestimate when calculating your cost per square foot. Some things that many new homeowners forget are things like furnishings, appliances, paint, molding and general cosmetics. These can add up quickly--especially if you are interested in having nice things throughout the home. As a good rule of thumb, calculate for an additional $25 per square foot over your original estimation.
Benefits
A good reason to seriously consider your cost per square foot is because it will help you budget. Building a home can quickly become overwhelming as you must make various significant decisions nearly every day--most concerning money. If you've laid out a game plan and a budget that calculates a cost per square foot in association with your building plans, you'll know right away during the process if you're over budget, or if you can figure in more money.
Warning
It's important to remember that cost per square foot is different for every single home. It is your responsibility to understand your financial limitations before you get underway, figure your budget, calculate your square footage (overestimating), and sticking to that budget when under construction.
