How to Estimate New House Building Costs

Written by chuck brown
  • Share
  • Tweet
  • Share
  • Pin
  • Email
How to Estimate New House Building Costs
Estimating house building costs is the first step toward controlling them (house under construction image by Jana Lumley from

Building a new house is a major undertaking. It is a multiphase project with disaster potential every step of the way. For such a task to be completed smoothly, many different partners have to come together and work diligently toward final completion. Communication and coordination are absolutely essential to sustain steady, uninterrupted progress. Not only does every step of the construction have to be well planned, but so do costs. In construction, costs can get out of control very quickly. Plan them as closely as you plan the work and costs can be better controlled.

Skill level:


  1. 1

    Order a good set of house plans. Make sure you also order a materials list with the plans. Rely on the materials list first and foremost in your estimations, since the architect who designed the house should know best how much of which materials are needed for constructing the house.

  2. 2

    Make two separate lists, one for materials and one for labour. Add the two each time you estimate the cost of another step of construction toward completion. Be wary of contractors who give you abnormally high "estimates" which do not agree with the materials list the architect, who drew the plans, says the job will take.

    How to Estimate New House Building Costs
    Separating labour and materials gives a more exact accounting of just where the money is being spent (publicity for construction image by iMAGINE from
  3. 3

    Research material and labour costs. Use the Internet and local library. Talk with family and friends who have built most recently. Establish a range for what each aspect of the construction will cost. Include 20 to 30% cost overruns, since construction can be a very uncertain endeavour.

  4. 4

    Complete your new house building cost estimate in an orderly fashion. Get lot preparation estimates first. Write down this cost as the first item in your final estimate list.

    How to Estimate New House Building Costs
    Site preparation costs are generally estimated by the number of hours the heavy machinery will be run (high cost of housing image by Pix by Marti from
  5. 5

    Call foundation companies, as opposed to brick and block masons, and plan to pour the foundation instead of using block and mortar mix. (Poured foundations eliminate the joints of breeze block and mortar mix foundations and reduce moisture issues.) Use your house plan's foundation specs to get the most competitive estimate here.

  6. 6

    Use your materials list cost per square foot to set the framing cost. Hire the crew with the most accuracy, experience and best dry-in time estimate. Schedule this part with an eye on the local weather guessers, since framing should be completed quickly and in dry weather.

    How to Estimate New House Building Costs
    Framing must be square, plumb and level to build a first-rate house (house construction image by Gale Distler from
  7. 7

    Go by the same format as you work your way through to the final estimate. Complete electrical and plumbing estimates, drywall, roofing, finish carpentry, and flooring. Write down each price total combining materials and labour. Total the entire list, and you will have a pretty close cost estimate.

  8. 8

    Check your total estimate. Use a round figure of £48-$100 per square foot (excluding site preparation, landscaping and driveway). Plug in the figure your market says is correct for similar houses built in the area. For example, if you are building a 2,000 square foot house, multiply 2,000 times £48, to get a total of £97,500, or £65 per square foot times 2,000 square feet equals £130,000. Re-examine and adjust your totals if your estimate exceeds this range.

    How to Estimate New House Building Costs
    Depending on where you live, materials and labour will be about equal parts of the total costs (calculator image by Alexander Zhiltsov from

Tips and warnings

  • Be sure to ask contractors for a cost break down of their estimates if they do not give one initially.
  • Do not pay any contractor any money before any work is begun or completed.

Don't Miss

  • All types
  • Articles
  • Slideshows
  • Videos
  • Most relevant
  • Most popular
  • Most recent

No articles available

No slideshows available

No videos available

By using the site, you consent to the use of cookies. For more information, please see our Cookie policy.