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What is Your Cost per Square Foot?

November 8, 2011
I recently received a phone call from someone asking me the question: "What is your average cost per square foot?" I get this question often and I cringe when I hear it. People will ask me this question sincerely in order to compare me to another builder. I beg you; do not compare builders based on this question. The answer is more complex than the question and you will not have an accurate measure of what your home will cost. So what do I do when I get this question? First, I state that I have built homes before for $94 per square foot all the way up to a home I built for $156 per square foot. (Not including land.) Why the difference? 1. You have to know what is being considered in the cost per square foot number. Does it include landscaping, irrigation, patios, or decks? What type (concrete, pavers, asphalt, or combination) or size of driveway? We have built homes with 700 foot long driveways and ones with 35 foot driveways. All of these (and there are more) represent a big cost difference. 2. A ranch home vs. a two story home. Many people will say to me that they want a two story home because it is less costly to build than a ranch. I agree with them. The reason for the less expense with a two story home is that you have a smaller foundation, fewer trusses and perhaps fewer floor joists than you have with a ranch home. However there is a situation when a ranch home is less expensive than a two story home. That is when you finish the lower level, the basement. With a ranch home, you double your square footage when you finish the lower level. With a two story home, you can only grow finished square footage by approximately 1/3 when you finish the lower level. That's the difference. 3. Structure - the majority of the cost of a home is in the structure. Simplify the structure and you lower the cost per square foot of a home. We once built a 2,400 square foot home that had $15,000 trusses, whereas most of the 2,400 square foot homes we build have trusses of $9,000. Comparing the same homes again, the windows in the more expensive home cost $32,000. The other home had $11,000 worth of windows. Therefore, two homes with the same square footage and one has $27,000 more cost in just two components of the home. Other components can have a greater impact on the cost than the two examples I selected. One more point on structure, building a home shaped like a rectangle is less expensive than building a home that has lots of jogs, angles, and so forth. Again, simplify the structure and you lower the cost per square foot. 4. What is on the inside of the home? We build homes that have aluminum clad wood windows, lots of tile, wood floors and solid surface countertops. We have also built homes of the same size that have vinyl windows, vinyl floors, and laminate countertops. So I ask, what windows/doors, plumbing fixtures, flooring, appliances, cabinets, countertops and woodwork? There are many options with varying quality available to suit the taste of each homeowner. Imagine comparing a Mercedes E350 sedan (3.5L V6 7-speed Automatic) at $50,490 to a Ford Fusion SEL sedan (3.5L V6 FFV AWD 6-speed Automatic) at $27,150. Both are 4- door sedans with what appears to be similar performance. Could you simply ask these manufacturers the cost per pound and get a true comparison of these two vehicles and would you buy your next car based on the price per pound? Hardly not. Oh, and don’t forget what is on the outside of the home makes a difference too. Brick or stone (real or man-made), siding (vinyl, fibercement, or cedar) has a great impact on the costs. In some cases the subdivision will dictate what and how much of the exterior cladding will be permitted on the front of a home. A big front porch (like a wrap-around) or a small front porch is another cost consideration. "Yeah, yeah all that stuff above is fine, but how can I get an answer to my question?” 1. Sit and meet with the builder to review the plan that you have (or desire) and go through a brief list of the features you desire. A builder can ballpark a price for you. 2. Ask the builder to show you some homes that they have built and determine the price of those homes and the square feet. Then talk about the features of the home that make it more expensive or less. Please keep in mind the old adage "garbage in, garbage out." When you are seeking a cost estimate from a builder; the less detail you give, the less accurate the estimate. Do you want accuracy? Then give detail. When can you compare builders on a cost per square foot basis? This is tough, but you can compare some builders in this manner when you are comparing homes that are in the same subdivision with similar features like bedrooms and bathrooms, similar exteriors, similar interior features. Look at the homes that are already built. The reason that comparison may be valid is because their building components are likely similar. Their development requirements are similar and they probably have a similar look. You have heard the saying, “compare apples to apples”. In summary, I go back to my earlier statement "the answer is more complex than the question". Comparing builders on a cost per square foot basis is misleading. Build on! Build well! Build with confidence! If you arrived at our blog from a source other than our website, please visit us at www.CLDesignBuild.com. Further, if you are considering building a home, please contact us. We would welcome the opportunity to be a part of your dream. Lastly, please know that we build homes in the western suburbs of Chicago, IL area – Yorkville, Oswego, Naperville, Aurora, Plainfield, Geneva, Batavia, and many other beautiful areas surrounding Northern Illinois.  My words above are universal.  It doesn't matter where you build.  The dollar amounts may be different, but the philosophy and practice are the same.

While Bob and I have worked with CL Design Build, the experience has been positive, professional, and one we would pursue again. Our dream home was creatively designed balancing practicality and cost. Cheryl’s attention to detail will make our home a focal point of the neighborhood. Thanks to all at CL Design Build!

~ Bob and Ann Elwood

We enjoyed working with CL Design Build to build our 100% custom dream home. Starting with a blank piece of paper, we were able to build our home from bottom to top using our own ideas and concepts. We are really enjoying our home today.

~ Doug and Cinda Coyne

That teamwork between Brad and Cheryl ensured that we received the best that is available. There is a trust and bond between CL Design-Build and their clients that gave us peace of mind. The numerous compliments that we receive on our beautiful home are tremendous!

~ Richard and Kristine Christie