Tips from a Contractor on How to Save Money when Building a House

Sharing is caring!

When it comes to building a new home, the costs can quickly add up. After 20 years as a residential contractor, Josh offers you tips on how to save money when building a house without sacrificing quality or style.

Many people think the best way to save money when building a house is to be your own general contractor. In many states, you don’t need a license to manage the project yourself, and doing so can save you more than 10% of your total building cost. However, this option is not for everyone, and it requires a lot of time, effort, and knowledge. If you decide to take on this role, you will need to coordinate with subcontractors, schedule inspections, and ensure that everything is up to code.

Another way to save money is to know how you use your living space. Good designers and builders will ask you about this at the beginning of the project, and it’s essential to be clear and honest about your needs and preferences. By understanding how you and your family use your living space, you can avoid unnecessary features and focus on what matters most. This can help you save money on construction, maintenance, and energy bills.

Understanding the Basics of Building a New Construction

When building your own home, it’s important to understand the building process and the first steps you need to take. This will help you make informed decisions and save money in the long run.

The first step is to determine the type of house you want to build. This will depend on your budget, lifestyle, and personal preferences. You can choose from a variety of styles, such as traditional, modern, or minimalist. Once you have a clear idea of what you want, you can start looking for a builder or architect who can help you bring your vision to life.

Before you start building, it’s important to have a solid plan in place. This includes creating a budget, obtaining necessary permits, and hiring a team of professionals who can help you with the construction process. You should also consider factors such as the location of your home, the size of the lot, and the materials you want to use.

One of the most important things to keep in mind when building your own home is to avoid unnecessary expenses. This means choosing cost-effective materials and avoiding custom designs that can add up quickly. You can also save money by doing some of the work yourself, such as painting or landscaping.

Overall, building your dream home can be a rewarding experience, but it requires careful planning and attention to detail. By understanding the basics and making informed decisions, you can save money and create a home that reflects your personal style and needs.

Choosing the Right Builder for Your New Home

Choosing the right builder is one of the most important decisions you will make when building your home. A good builder can save you money, time, and headaches, while a bad one can cost you dearly. Here are a few things to keep in mind when selecting a builder:

• Look for a builder with years of experience in the industry. An experienced builder will have a proven track record of success and will be more likely to deliver a quality home on time and within budget.
• Do your research and read reviews from previous customers. This will give you an idea of the builder’s reputation and level of customer service.
• Make sure the builder is licensed and insured. This will protect you in case of any accidents or damages that occur during the construction process.
• Don’t just go with the cheapest option. While it may be tempting to choose the builder with the lowest bid, this can often lead to subpar workmanship and hidden costs down the line.
• Look for a builder who is a good fit for you and your project. You will be working closely with your builder for several months, so it’s important to choose someone who you feel comfortable communicating with and who understands your vision for your home.

By taking the time to choose the right builder for your project, you can save yourself time, money, and stress in the long run.

Planning Your Budget

When it comes to building a house, planning your budget is crucial to ensure that you don’t overspend and end up with financial troubles in the long run. Here are some tips to help you plan your budget effectively:

Determine Your Total Budget

The first step in planning your budget is to determine your total budget. This includes not only the construction costs but also other expenses such as permits, taxes, and fees. You should also factor in the cost of land, as this can vary greatly depending on the location.

Consult a Financial Advisor

Consulting a financial advisor can be helpful in determining your budget. They can help you understand the long-term financial implications of building a house and provide guidance on how to manage your finances effectively.

Research Average Costs

Researching the average cost of building a house in your area can give you a good idea of what to expect. Keep in mind that these costs can vary depending on factors such as the size of the house, materials used, and location.

Prioritize Your Needs

When planning your budget, prioritize your needs over your wants. This means focusing on the essentials such as the number of bedrooms and bathrooms, the size of the kitchen, and the overall layout of the house. Don’t get carried away with expensive finishes and features that you don’t really need.

Keep an Eye on Total Costs

Throughout the building process, keep an eye on the total costs. This means tracking expenses and making adjustments as necessary to stay within your budget. It’s also important to factor in unexpected expenses such as delays or changes in plans.

By following these tips, you can plan your budget effectively and avoid overspending on your new home.

Selecting the Right Land

When it comes to building your dream home, selecting the right land is crucial. Not only will it determine the location and surrounding environment of your home, but it will also impact the cost of your overall project. Here are some tips to help you select the right piece of land while keeping costs in mind:

1. Work with a Real Estate Agent: A real estate agent can help you find available land for sale that fits your budget and location preferences. They can also provide valuable insights into the local real estate market and help you negotiate a fair price.
2. Consider the Cost of Land: The cost of land can vary greatly depending on location, size, and other factors. Before making an offer, research the average cost of land in the area and compare it to the asking price. You may also want to consider purchasing raw or undeveloped land, as it can be more affordable than land with existing structures.
3. Look for Land with Existing Infrastructure: If possible, look for land that already has existing infrastructure such as water, electricity, and gas lines. This can save you money in the long run by avoiding the need to install these utilities yourself.
4. Check for Zoning and Building Restrictions: Before purchasing land, check for any zoning or building restrictions that may impact your construction plans. This can save you time and money by avoiding any potential legal issues or setbacks during the building process.

By following these tips, you can select the right piece of land for your dream home while keeping costs in mind. Remember to work with a real estate agent, consider the cost of land, look for land with existing infrastructure, and check for zoning and building restrictions.

Designing Your House Within a Budget

Designing your house is one of the most exciting parts of building a new home. It’s where you get to create the home of your dreams, but it’s also where you can easily overspend. Here are some tips to keep in mind when designing your house to save money without sacrificing quality.

Consider an Open Floor Plan

An open floor plan is a great way to save money on your home’s design. It can make your home feel more spacious and eliminate the need for extra walls and doors. This can save you money on materials and labor costs. An open floor plan can also increase the natural light in your home, which can save you money on electricity bills.

Keep it Simple

When designing your home, it’s important to keep it simple. The more complex the design, the more expensive it will be to build. Stick to a simple design that meets your needs and fits your budget. Roof lines and porches are some extras that homeowners don’t realize will increase the cost. Remember that you can always add more features later on.

Look for Affordable Home Plans

There are many affordable home plans available that can help you save money on your home’s design. Consider browsing pre-made house plans to find one that fits your vision and budget. Tiny homes and metal building homes are also a great option for those looking to save money on their home’s design.

Consider Energy Efficiency

Designing an energy-efficient home can save you money on your energy bills in the long run. Consider adding features such as energy-efficient windows, insulation, and appliances to your home’s design. This can help you save money on your energy bills and reduce your carbon footprint.

Work with a Designer

Working with a designer can help you save money on your home’s design. They can help you create a design that meets your needs and fits your budget. They can also help you find affordable materials and finishes that will make your home look great without breaking the bank.

By following these tips, you can design your dream home without overspending. Keep in mind that designing your home is a process, and it’s okay to make changes along the way.

Optimizing the Size of Your Home

When building a house, one of the most significant costs is the size of the home. The larger the home, the more materials and labor are required, which can increase the overall cost of the project. Therefore, optimizing the size of your home can help you save money. Here are some tips to help you do that:

• Determine your needs: The first step in optimizing the size of your home is to determine your needs. Consider how many people will be living in the house, how much space you need, and what features are essential. By doing this, you can avoid building a home that is too big or too small.
• Think about the future: While it is essential to consider your current needs, it’s also important to think about the future. If you plan on having children or hosting guests, you may need more space. However, if you plan on downsizing in the future, building a smaller home may be a better option.
• Consider the cost per square foot: When building a house, the cost per square foot is an essential factor to consider. The larger the home, the higher the cost per square foot. Therefore, building a smaller home can help you save money.
• Maximize the use of space: Another way to optimize the size of your home is to maximize the use of space. Consider using multi-functional rooms, such as a guest room that doubles as a home office. Also, consider built-in storage solutions to avoid clutter and make the most of your space.
• Avoid unnecessary features: Finally, when building a home, it’s essential to avoid unnecessary features that can increase the overall cost. For example, a large garage or a swimming pool may be nice to have, but they can significantly increase the cost of the project.

By optimizing the size of your home, you can save money while still building a comfortable and functional space. Consider your needs, think about the future, and maximize the use of space to build a smaller house that provides you with everything you need without taking up too much space.

Smart Material Choices

When building a house, choosing the right materials can make a big difference in your overall budget. Here are some smart material choices that can help you save money:

Building Materials

Consider using recycled or salvaged materials for your construction. Not only are they environmentally friendly, but they can also be more affordable than new materials. You can find recycled materials at salvage yards, Habitat for Humanity ReStores, and online marketplaces. When Josh and Amanda built their most recent home, they used an old porch column as their Mantle in the new home! A little sanding down and staining and it was perfect and sentimental part of their new home.

Structural Elements

Design your house with standard sizes in mind. This can help reduce the amount of custom work required, which can be expensive. For example, using standard-sized windows and doors can help save money on installation costs.

Another way to save money is to use prefabricated structural elements. These are pre-made components that can be assembled on-site, which can save time and labor costs.

Energy Efficiency

Investing in energy-efficient materials can help you save money in the long run. For example, using insulation with a high R-value can help reduce your heating and cooling costs. Energy-efficient windows can also help reduce your energy bills.

Other Tips

• Use durable materials that require minimal maintenance to save money on repairs and replacements.
• Compare prices from different suppliers to find the best deals.
• Consider the lifespan of the materials you choose. Investing in high-quality materials that last longer can be more cost-effective in the long run.

By making smart material choices, you can save money while still building a high-quality home.

Managing Construction Costs

Building a new home can be an expensive endeavor, but there are ways to manage the costs and save money without sacrificing quality. Here are some tips to help you manage construction costs:

Get a Construction Loan

If you don’t have the cash to pay for your new home upfront, a construction loan can help you finance the project. You will typically pay interest only on the amount you have borrowed until the home is completed, at which point the loan will convert to a standard mortgage. Shop around for the best deal on a construction loan, and make sure you understand the terms and fees associated with the loan.

Cut Back on Up-Front Costs

Cutting back on up-front costs can help you save money in the long run. For example, consider using cheaper materials for non-essential parts of the home, such as the garage or basement. You can also save money by doing some of the work yourself, such as painting or landscaping.

Avoid Change Orders

Change orders can be costly, as they involve making changes to the original plans and often require additional materials and labor. To avoid change orders, make sure you have a clear understanding of what you want before construction begins. Work closely with your builder to ensure that the plans are accurate and that any changes are made before construction starts.

Watch for Additional Costs

Additional costs can quickly add up, so it’s important to keep an eye on them. For example, installation costs for appliances, fixtures, and other items can be significant. Make sure you understand what is included in the price of the home and what additional costs you may incur.

Be Your Own General Contractor

Being your own general contractor can save you money, but it also requires a lot of work and responsibility. If you have the time and expertise to manage the project, you can save money by hiring and coordinating expert subcontractors yourself. However, if you don’t have the experience or time, it may be best to hire a professional general contractor.

By following these tips, you can manage construction costs and save money when building your new home. Remember to shop around for the best deals on materials, services, and loans, and to keep a close eye on costs throughout the construction process.

Saving on Finishing Touches

When it comes to building a new home, finishing touches can be the cherry on top of a perfect sundae. They can make a house feel like a home and add value to your property. However, they can also be a significant expense if you’re not careful. Here are some tips to help you save money on finishing touches without sacrificing quality.

Light Fixtures

Light fixtures can be expensive, but they don’t have to be. Consider shopping for fixtures online or at discount stores. You can also save money by installing fewer fixtures or choosing less expensive options. Keep in mind that the type of bulb you use can also affect your energy bill, so choose energy-efficient bulbs to save money in the long run.

Window Treatments

Window treatments can add privacy, style, and energy efficiency to your home. However, they can also be costly. Consider DIY options like curtains or blinds, or shop for discounted options online or at home improvement stores. You can also save money by only covering the windows that need it, rather than every window in your home.

Hardwood Floors

Hardwood floors are a popular choice for their durability and timeless look. However, they can also be expensive. Consider using hardwood in high-traffic areas like living rooms and hallways, and opting for less expensive flooring options in bedrooms and other low-traffic areas. You can also save money by choosing pre-finished hardwood, which is less expensive than site-finished hardwood.

Standard Windows

Windows can be a significant expense, especially if you choose custom or high-end options. Consider using standard windows instead, which are less expensive and can still provide energy efficiency and style. You can also save money by installing fewer windows or choosing smaller sizes.

In conclusion, finishing touches can add value and style to your home, but they don’t have to break the bank. By shopping around, choosing less expensive options, and being strategic with your choices, you can save money on finishing touches without sacrificing quality.

DIY Opportunities

If you are looking to save money while building your house, taking on some do-it-yourself (DIY) projects can be a great way to cut costs. Here are some DIY opportunities to consider:

• Basic demolition work: You can save money by doing the demolition work yourself. This includes removing old flooring, cabinets, and fixtures. However, be sure to consult with your general contractor before starting any demolition work to ensure that you are not damaging any load-bearing walls or other important structures.
• Painting: Painting is a task that most homeowners can handle on their own. You can save money by painting the interior and exterior of your home yourself. You can purchase paint and supplies from home improvement stores like Home Depot.
• Landscaping: You can save money by doing your own landscaping. This includes planting trees, shrubs, and flowers, as well as laying sod and installing irrigation systems.
• Flooring installation: If you have some experience with DIY projects, you may be able to install your own flooring. This can save you money on labor costs. However, be sure to research the installation process thoroughly before starting the project.
• Cabinet installation: Installing cabinets can be a DIY project if you have the right tools and experience. You can purchase cabinets from home improvement stores like Home Depot.

Keep in mind that taking on DIY projects can be time-consuming, so you may need to take time off from your day job to complete them. Additionally, if you are not experienced with DIY projects, it may be best to leave certain tasks to the professionals to avoid costly mistakes.

Additional Tips for Saving Money When Building a New Home

When building a house, there are many additional tips and tricks you can use to save even more money. Here are some of the best ways to keep your costs down:

• Shop around for materials: Don’t just buy the first item you see. Look for the best price and quality. You can save a lot of money by comparing prices from different suppliers.
• Consider pre-fabricated materials: Pre-fabricated materials can be a great deal. They are often cheaper and easier to install than traditional materials.
• Take on some of the work yourself: If you have some DIY skills, consider taking on some of the less skilled jobs yourself. This can save you a lot of money on labor costs.
• Buy stock house plans: You may not be a professional architect or engineer, but you can eliminate the extra expense of custom blueprints by browsing premade house plans to find one that best fits your vision and budget.
• Use energy-efficient materials: Energy-efficient materials can save you a lot of money in the long run. They may be more expensive upfront, but they will save you money on your energy bills.
• Stick to your budget: It’s important to have a tight budget and stick to it. Don’t overspend on unnecessary items.

By following these additional money-saving tips, you can build your dream home without breaking the bank.

Conclusion

In conclusion, building a new house can be an exciting and rewarding experience, but it can also be expensive. By following the tips and strategies outlined in this article, you can save money when a house without sacrificing quality or style.

When building a custom home, it is important to work with a reputable builder who is willing to work within your budget and help you find ways to save money. Managing the project yourself can also save you money, but be sure to do your research and understand the responsibilities of a general contractor.

One of the most effective ways to save money on building a new construction home is to shop around for vendors, including the builder, architect, designers, and your lender.

Additionally, understanding how you and your family use your living space can help you design a more efficient and cost-effective floor plan. Consider using energy-efficient materials and appliances to save money on utility bills in the long run.

Finally, be sure to budget for unexpected expenses and factor in the cost of the entire house, not just the construction costs. By being diligent and proactive in your planning and research, you can save money on building a house and create a beautiful and functional home that meets your needs and budget.

Frequently Asked Questions about building a home

What are some ways to reduce construction costs when building a house?

There are several ways to reduce construction costs when building a house. One way is to choose a simple design that requires fewer materials and labor. Another way is to work with a builder who has a good reputation for quality work and will help you stay in budget. You can also save money by doing some of the work yourself, such as painting or landscaping.

How can I save money on building materials for my house?

To save money on building materials for your house, you can shop around for the best deals and compare prices from different suppliers. You can also consider using recycled or salvaged materials, which can be much cheaper than buying new. Another option is to buy materials in bulk, which can often get you a discount.

What are some design strategies to save money when building a house?

Design strategies to save money when building a house include choosing a simple design that requires fewer materials and labor, using standard sizes for cabinets and countertops, and avoiding unnecessary features and upgrades. You can also consider using energy-efficient materials and appliances, which can save you money on utility bills in the long run.

How much money should I aim to save before building a house?

The amount of money you should aim to save before building a house depends on several factors, such as the size and complexity of the house, the cost of materials and labor in your area, and your personal financial situation. It’s a good idea to consult with a financial advisor or mortgage lender to determine how much you can afford to spend on a house and how much you should aim to save.

Are there any secrets to building a house that can save me money?

There are no real secrets to building a house that can save you money, but there are several strategies you can use to keep costs down. These include choosing a simple design, shopping around for the best deals on materials and labor, and doing some of the work yourself. It’s also important to have a clear budget and to stick to it throughout the construction process.

What are some important things to avoid skimping on when building a house?

While it’s important to keep costs down when building a house, there are some things you should never skimp on. These include the foundation, structural components, and electrical and plumbing systems. Cutting corners on these essential elements can lead to serious safety issues and costly repairs down the line. It’s also important to invest in quality materials and workmanship for features that are important to you, such as a custom kitchen or a luxurious bathroom.