Budgeting for a Custom Home

How much does it cost to build a custom home?

In SF Bay Area, California we see typical construction costs for a new home start at around $350 per square foot and up. For example, a new construction 2,500 square foot home would have a rough construction budget of $875,000 (2500 x $350). This is a rough estimate as there are many factors that can affect the construction cost.

We recommend starting with 10-15% of the construction costs as a budget line item for architectural design fees. For a new construction project, you could budget 10%, while if it is a more complex site, or a renovation/addition to an existing structure 15% would be a better estimate due to the additional project complications. A 10% architectural design fee for this project would be $87,500.

When budgeting for your total project cost, other things to consider include the cost of the land, surveying, site work & utilities, permitting, and costs for furnishing the new home. Assuming you aren't using cash for all of the project expenses, the cost of a construction loan would also come into play.