How much does it cost to build a house?

With each choice you make, you can reduce your costs on housing exponentially and thus, leave more money for living, traveling or buying that new car you've had your eye on.

Do you know the saying "building a home is higher mathematics"?

Based on the amount of information you are supposed to work through when making a decision, the saying is accurate - only by carefully analyzing every detail can you be sure of a successful deal. Needless to say: the salesmen are people too, so the more you know, the better it is.

Transporting elements of prefab home by Elumaja LLC in Tartu Estonia.

Do your homework!

The best (and the simplest) way to get a feel for the potential price of your home (an approximate square footage price) is to look around in your neighborhood: ask around, consult real estate brokers (consultation is usually free), ask your friends, search the web - the more insight you have, the better deal you are likely to make.
After you have calculated an average square footage cost, you will multiply that cost by the finished square footage of your house plan to get a rough estimate. Simple as pie!

Assembly of first spatial unit of prefab home by Elumaja LLC.

An easy and a fast way to get the idea about costs is to compare your future house price with the new houses on sale in your area. Look at newly constructed homes that are similar in size, style, quality, and features to the home you want. Take the price of the home, deduct the price of the land, and divide that amount by the square footage of the home. More exact method would be calculating a construction budget item-by-item.
Here’s a budget template to help you out.

Go to the source (no middle-men)

It's a well-known fact, but the more middle-men you use the higher the price will be. Easy, right? Not really!

On average, a person uses about 3 to 4  different middle-men to get a product or a service. A solution to this is simple. For example, instead of going to a supermarket to get all of your groceries (dairy products, meat, veggies), you could visit local farmers to get the stuff. By doing so, you'll 'cut out' the purchasing managers, transportation and the grocery stores themselves, reducing the price of your food at the same time.

The same applies to housing. You could buy a fully furnished house and just worry about moving in. Or you could buy house plans off the internet (there are many such sites on the web) and let a local contractor build it.

Or you could build a house yourself. If DIY is a mystical combination of letters that makes no sense to you whatsoever, try building a greenhouse. It really is that easy!

By the way: buying stuff from the source (manufacturer) is the next big thing!

Less is more

The most expensive areas in a home are the bathrooms and the kitchens: the number of windows and/or doors their size and quality can and will also affect the cost. as can vaulted ceilings and high roof pitches.

Long story short: many houses are just too "bling" having excess features or elements, that will drain money during the construction and after you have moved in.

Assembling second unit of prefab home by Elumaja LLC.

In different parts of the world the housing culture varies a lot: in Scandinavia, for example, people are interested in a more natural living, focusing on keeping the costs down and the environment clean. Other parts of the world still seem to be hooked on the notion, that bigger is better. In terms of showing off, yes - that is exactly right. But in terms of living?

If you have a house that is expensive to build (mortgage) and expensive to maintain (time&money), how come is that an investment for you and your family? It seems more of an investment for the banks and/or real-estate developers, not you?

The truth is, a house can be built for less than $35,000 and at the same time, it can cost more than $3,500,000 - it's all up to you.

Just remember: a good home doesn't have to be expensive, but an expensive home doesn't have to be good.

Photos by Tiit Sild
Indrek Kuldkepp