One of the most common questions we hear from prospective clients is, “How much does it cost to build a custom home?” No matter if you are looking at building a new home in Cheyenne or another location, the answer is always complicated and influenced by many factors. So how do you budget for a custom home? If you are looking for a home builder that is affordable and knowledgeable, our experts have been building custom homes for more than 20 years, and today we have tips to help you prepare for this exciting undertaking.
Steps in Preparing a Budget
Decide What You Want
In our experience, the clients who have the easiest time navigating the building process are those who have determined their budget ahead of time. The first step in establishing a solid budget is to decide what you must have in your new home, such as:
- How many square feet?
- How many bedrooms and bathrooms?
- Where do you want the home to be located?
- What unique features does your family need?
Evaluating how you live in your current home and what does and doesn’t work is crucial at this stage of the process. What do you love about your current living space and what would you change? Make a list of needs and wants that can be discussed with your builder.
If you want to make the build more affordable, your builder will likely propose a few different approaches. A home with a simple, smaller floorplan will generally cost less in the long run. If you have a large family and a smaller home is not an option, consider choosing a stock floor plan that does not require custom design modifications and add energy-efficient features to cut down on utility costs over the lifetime of the home.
Choose a Reputable Builder
Every builder operates a bit differently. Some specialize in high-end custom builds, while others build only spec homes. Gateway Construction, LLC falls right in the middle — we can build a custom home from scratch, a semi-custom home with certain unique features or a spec home that is ready for move-in. Many buyers spend $150-200 per square foot on a new Gateway home with an unfinished basement, depending on the features and finishes selected. When you’re trying to choose an affordable home builder, spend some time researching the work they do and the price point they build in to make sure they can meet your needs. Read our blog to get additional tips on how to choose a custom home builder.
When it comes to building a custom home, expect that there will be changes to the plan. Your favorite tile may be backordered, bad weather could impact the job site or you might change your mind about the number of bathrooms you need, forcing alterations to the design and/or the schedule. However, a good builder will keep you informed of all changes as they happen. Unforeseen costs usually arise with a construction project, so it’s crucial to include some wiggle room in your budget — usually about 10% of the overall cost. So, if you’re looking to spend $500,000 on a new home, set aside an extra $50,000 to cover contingencies. With luck, your final cost may even end up being less than your budgeted amount, allowing you to apply the money toward further home upgrades or new furnishings.
Talk With a Lender
Once you have a basic idea of what you want to build and an estimate of what it will cost, meet with a loan officer to get preapproved for a construction loan. This will ensure you have the money for your project. Skip this step and you could waste time and money designing your dream home, only to find that you can’t afford it. If you are in the ballpark of what you can afford, you may still need to make some compromises during the design process to stay within budget. If your loan preapproval comes back lower than expected, you may want to consider a smaller home or a spec home, or swap finished space for unfinished space (such as an attic or basement) that you can finish later.
A dream home doesn’t pop up overnight — it takes extensive planning and hard work on the part of both you and your builder. Be patient, embrace the process and prepare to enjoy the home you’ve always wanted!
Work With an Affordable Home Builder
No matter what your dream home looks like, it’s important to plan a realistic budget, pay attention to details and choose an affordable home builder as your partner for the job. Gateway Construction, a company with decades of experience, can help you avoid unnecessary expenses and streamline your project with our efficient construction process. If you are building in southeast Wyoming and working to plan a budget for a custom home, we would be happy to help. Give us a call today at (307) 632-8950 or contact us online. Let’s start building your future today!
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