Tim Barber House & Home | Blog | Build vs. Buy: A Guide to Building fr | Build vs. Buy: A Guide to Building from a House Plan in Austin, Texas

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Build vs. Buy: A Guide to Building from a House Plan in Austin, Texas
6.26.17

This month we explore whether it is cost-effective to build your own home in Austin, Texas and the surrounding suburbs or if it is less expensive to buy a pre-existing home. We give you a financial breakdown of cost-to-build along with some key factors to consider to help you decide whether to build or buy in Austin.

Cost to Build in Austin, Texas

Average cost to purchase a lot in Austin and surrounding areas:

Land and teardowns in Austin and the surrounding suburbs range from $45,000 to $150,000*. (This figure does not include the cost to demolish a teardown or adding new utilities/septic/grading/etc. for an empty lot).

Cost to purchase and/or modify an existing house plan:

If you purchase a well-designed plan from a licensed architect, a 2,500 square foot house costs anywhere from $900 to over $5,000. Custom modifications to a house plan cost an additional $2,000-$10,000.

Average cost per square foot to build:

The range of costs to build is between $175-$250 per square foot. Therefore, to build a 2,500-square foot house at $200/sq. ft. costs approximately $500,000. Factor in an additional 10% for soft costs and hidden expenses, such as permits, design fees, surveys, soils tests, etc., to bring the total to $550,000.

Final Total

If you purchase a $60,000 lot or teardown, pay $2,000 for a 2500 sq. ft. house plan with no custom modifications, and hire a contractor to build your home at $200 sq. ft., the approximate cost to build your dream home is $612,000 (Please note: this figure does not include the cost of landscaping, pool and/or hardscaping).

Cost to Buy an Existing Home in Austin, TX

Newly-constructed 2500+ sq. ft. homes in the Austin area range from $375,000 to over $900,000.  Depending upon the neighborhood, an existing 2500 sq. ft. house will run you anywhere from $250,000 to over $1-million*. In addition, older houses of the same size in historic neighborhoods cost between $825,00 to over $1-million*

*Based on Redfin.com

Things to Consider when Building or Buying

Before you put an offer on that house or start shopping for the perfect house plan, here are four key factors to think about.

Get What You Want

It’s important to understand what you need in a home, how long you intend to live the in house, and how the house may need to grow or alter over time to suite your lifestyle before making a decision. (TBH&H has a questionnaire to help you decide what house is perfect for you) 

When building your own home, you have more freedom to choose a plan or collaborate on a plan to address your specific needs, such as storage and convenience, rather than altering a pre-built house to suit your needs/wants. You also have the opportunity to position the house in the best location on the lot to maximize natural light, minimize heat load and catch the summer breezes.

However, if minimizing cost is a priority, a partial renovation to a pre-existing home may be more cost-effective than starting from scratch. If the history of a home is appealing to you, then you may gravitate towards purchasing an older home.  Just keep in mind that the renovation of a historic home is usually more complex and often more expensive than the renovation of a home built in the last few decades.

Neighborhood Context

When you purchase an existing home, chances are the exterior style of the house is in keeping with the houses on its block. When you build you own house, you should be sure to take neighborhood context into account. Consider choosing a house plan that reflects the current vernacular of the neighborhood, including the scale, setback, material choices and building styles of the homes on the block—otherwise, your house may stick out like a sore thumb.

Time

Building a home from the ground up takes a considerable amount of time. On average, from the moment you purchase a lot, choose a house plan, and start breaking ground, a new home can take up to 1 year to complete. So, you’ll need plenty of patience and resolve to see the process through to the end.  

However, purchasing an existing home in good condition allows you to move right in after the sale goes through. Unpack your boxes, hang a few pictures and you’re in! Even if you renovate before moving in (depending upon the scope of the renovation) you may be moving in earlier than if you build a new home.

Maintenance

Existing homes can have hidden expenses lurking behind the walls—plumbing leaks that cause mold issues, antiquated wiring that can become a fire hazard, dry rot or termites that may compromise the integrity of the framing or foundation. Upgrades such as changing your electrical panel to support all the technology we now use or adding air conditioning to a house with no existing ductwork can add considerable costs.  

In addition, depending upon the age of the home, the materials and the building practices used to construct it, you might be in for some major upkeep. Ninety-year mahogany woodwork must be oiled or waxed regularly or it will become dry, brittle and susceptible to damage. If the house was built in a slipshod way, waterproofing and insulation might be insufficient and systems could break down sooner than they are expected.

When building a new house with a reputable builder, you might avoid many, if not all, of these renovation headaches. Typically, the infrastructure of new homes is built to support current technology and creature comforts, like central air conditioning and heating.

In Conclusion

Many homeowners believe building a dream home is out of reach and therefore, they never consider how cost-to-build new may compare to purchasing an existing home. It turns out in that Austin, you might be able to build from a house plan for nearly the same cost as buying an existing home! Building your home is a viable option and gives you the freedom to personalize the look and layout of your house to suit your short-term and long-term needs.  

So if you are thinking of building a new home, the next step is choose your plan! Take a moment to view our available plans. Feel free to call us or email us with any questions you may have about building from a house plan.