What influences house building costs? Part 1

Construction costs vary hugely between different houses, neighbourhoods and cities. What influences these costs and how can you ensure that the construction costs you allow in your budget to build your new house, or renovate an existing home, are reasonable? Why will the cost of building a house in your neighbourhood be different to building elsewhere? Indeed, why can the cost of one house be different to the cost of a similar size house in the same area? Why does the price quoted by your builder increase as construction proceeds? How can you ensure that you stay within your budget? How can you reduce costs without ending up with a house of poor quality, or one that isn't functional, or that doesn't meet all your expectations?

​What influences house building costs?
The major construction cost drivers include:

• The size of the house. Bigger houses are more expensive to build.
• If the house is single storey or multilevel. Usually building upwards costs more money since foundations must be stronger and there’s an upper floor support structure to be completed. Of course single storey houses require a larger property which costs more. On sloping properties a single storey house may require more extensive site levelling which adds to the costs. So, a single storey house isn’t cheaper in all cases.
• The type of materials in the structure and the construction methods. This varies from place to place and will depend on what’s available, the methods that the local builders use and the availability of skills to execute the work. So, in one area conventional clay brick construction may be the way to go, while elsewhere clay bricks may not be available, or maybe bricklayers are in demand so the cost of using bricks is expensive. Before deciding on materials and construction methods it’s best to understand what methods are currently used in your neighbourhood, talk to contractors and others in the industry. Of course, it’s not to say that another option won’t be cheaper than what’s currently being used by most of the contractors. It’s important to understand that a material and a particular method of construction which experts tell you will be the cheapest, may not necessarily be the cheapest in your location.
• The height of your ceilings. High ceilings are great, giving the house a feeling of space and luxury. But having higher ceilings means you require higher walls, which adds to construction costs.
• The timing of construction. If there’s lots of construction happening in your city then you may find that material prices, wages and subcontractor’s costs have increased, and that the contractors are adding more profit to their prices. In addition, if resources are in demand then construction times increase, so your home could take longer to build. But, when contractors, suppliers and workers are desperate for work prices fall. This could mean a difference of 10% or more to your construction costs. Even starting construction of your house in the middle of the rainy season, or in the depths of winter could result in the contractor charging more, since their work could be interrupted or damaged by the weather.
• The layout and shape of your house. A simple square box house is usually the cheapest structure. Then, who wants to live in a box? It creates architectural interest to have a varied outline of the house, but remember that the more complex the shape of the outside walls of the house, the costlier the house will be.
• The fittings and fixtures. The cost of washbasins, sinks, bathtubs, taps, toilets, balustrades and lights vary hugely, and there could be a difference of at least 10% to the overall cost of your house depending on your choices. Certainly, you probably don’t want the cheapest fixtures, that look cheap and are probably not as reliable as better items, but do you really need the latest imported fitting that costs five times the price of another item?
• Topography of your property. Steep properties require more site works to level the area for the building. Steep sites may also make it more difficult for the contractor to access all work areas.
• Access to your property. If the local roads, or your driveway restrict the size of trucks and cranes that can reach your house it could mean that deliveries have to be made using smaller vehicles, which is usually more expensive. Offloading and lifting items by hand is often more expensive than using a crane or other mechanical means.
• Distance to the connection points for your utilities and sewer lines. The longer the length of cables and pipes, obviously the more they’ll cost.
• The ground conditions on your property. Digging in rock is expensive, while building on clay or other unsuitable ground may require special foundations. 
• Basements add time to construction. Depending on the ground conditions and the foundations of the neighbouring structures there could be additional complexities of excavating in rock, or retaining the sides of excavations in sand to prevent them collapsing.
• The size of windows. Large windows are wonderful since they let in natural light and provide views of the garden, or of ocean or mountain vistas. But large windows can be expensive, possibly even requiring costly structural beams to span over the top of them. In addition large panes of glass cost more than smaller areas of glass.

Conclusion
When selecting a property you should consider some of the above items. Some properties will be more expensive to build on that a similar sized property down the road. Even deciding on the position of the house on the property will influence construction costs.
In part 2 we will look at more items that could influence house construction costs.
​Make sure that your budget is correct and that you can build the house you want.

---

​​For more valuable tips and advice read: 'An Introduction to Building and Renovating Houses - Volume 1 Hiring Contractors, Managing Construction and Finishing Your Home' and 'Volume 2 Finding Your Ideal Property and Designing Your Dream Home'

​This is an extract from: 'An Introduction to Building and Renovating Houses Volume 2' by Paul Netscher. Available in paper or eBook from Amazon.com, Amazon UK, Amazon CA, Amazon AU and all online bookstores. To read more

​© 2018 This article is not to be reproduced for commercial purposes without written permission from the author.

---