When a potential client approaches you requesting a bid for new home construction, it’s critical to consider a variety of factors before you settle on an amount.
If your bid is unreasonably high, you might lose the client completely. Conversely, if your bid is too low, overheads will cut into your profit margins and could even affect your bottom line negatively.
This guide will detail some important factors regarding residential unit construction costs, and other issues you should keep in mind before making a bid.
1. Land Prep
Before you can actually begin any work on the house, you’ll have to prepare the land you’re building on. Site work includes clearing and preparing any trees or existing structures in the area, which costs about $1,000 to $4,000. Additionally, you may need to hook up the area with essential utilities such as electricity, water, and sewer systems, which can cost an additional $1,500 to $12,000.
The next step is laying down the foundation, which can cost between $5,000 and $8,000. Slab foundations are the cheapest because they involve adding a layer of concrete to the bottom for the structure to rest on. Basement foundations are usually the most expensive because they require more work and add square footage to your house.
The framing component can vary between $20,000 and $50,000 for a single-story home. This step involves putting up the main skeleton of the home, typically using uniform-sized lumber pieces.
4. Exterior Finishes
The home slowly starts taking shape with the addition of exterior finishes such as a roof, windows, siding, and doors. The cost of exterior finishes, on average, is about $50,000 but can go up substantially for luxury homes.
5. Installing Major Systems
Next, you need to start thinking about the major systems that are essential for any occupant, including power, plumbing, and the HVAC system. You’ll need a certified electrician to come in and hook up the house, which costs about $10,000.
The cost of plumbing and HVAC systems will vary depending on the system you’re installing and how complex the job is.
6. Interior Finishes
Interior finishes are essential to give your home a polished and complete look. This includes picking out flooring, paint, cabinetry, and several other little details that most new home construction owners look forward to the most. Depending on the quality of the materials you choose, the interior finishes can cost about $80,000.
7. Additional Considerations
There are some other considerations that you need to keep in mind before you make the bid. This includes costs of transportation, insurance, and any construction permits that you might need for the area.
You should also discuss any other amenities that the homeowner might want installed later, such as pool decks, landscaping, or a fancier driveway.
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When planning a residential project, there are some costs that even the most experienced contractors tend to overlook. These cause unnecessary delays and profitability issues later on.
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