Should You Consider Building Your Home

Maybe you thought you’d have to be nearing retirement, or at least firmly settled in mid-life, before you ever considered building a home. But if you’re living in a tight housing market, and you’re saving to buy a home anyway, Billshark would like to suggest you at least give some thought to building your own place, or buying into a new development.

Make no mistake, building a home is neither easy nor fast, but it could save you money in the long run. And, if you’ve been looking forever and either not finding what you need or have been outbid time after time, building is a possible solution.

The big question

When it comes to buying an existing home vs. building one, there are pros and cons to each. But the main consideration is, which is cheaper?

According to the National Association of Realtors (NAR), the current cost of buying an existing home averages $258,100, while the National Association of Home Builders (NAHB) puts the average cost of building a new home at $237,760.

Easy, right? Not quite.

When discussing price per square foot, some calculations put existing homes cheaper than building. Others say the opposite. But size matters here, because homes these days are usually larger than those built decades ago. So even if you can save money per square foot, you might end up paying more if you buy a new construction. These houses average 2,776 square feet as opposed to those built in the 1960s, which averaged around 1,500 square feet.

Mitigating factors

Unfortunately, there’s no easy answer because there are many factors that can tip the financial scales either way. Among these are:

  • where you build
  • the market in your location
  • how many and what type of upgrades you select
  • discounts from the builder
  • potential cost overruns
  • landscaping requirements, and more ...

Pros and cons of building

When making the decision whether to buy or build, carefully weigh the benefits and drawbacks of each:


  • You can design a home that meets your needs, rather than try to make do with someone else’s vision.
  • Newer homes will include more energy-saving features, saving you money on electric bills and helping the planet.
  • A new home will incorporate state-of-the-art technology, including “smart” features. Many older homes don’t even have enough electrical outlets to accommodate all the gadgets we use today.
  • Everything will be new, from appliances to roof to plumbing, meaning you’ll have few, if any, repair bills for years to come.


  • While you may be able to move into an existing home within weeks of finding it, you’ll have to wait at least six months until construction is finished.
  • Delays and cost increases are almost a given on any new construction home. These can stretch the home-building process out for years, and cost you more than you’d budgeted for.
  • It’s far easier to negotiate over price with an existing home than over a new build.
  • You may have to live with years of construction noise and disruption in a new development.

How to hold down costs

The number one way to make the home-building experience less risky is to work with an experienced real estate agent who knows the area well. He or she can help you:

  • find a reputable builder
  • know which development will best suit your needs
  • negotiate a contract and advise you of potential pitfalls
  • be aware of hidden or unexpected costs
  • secure financing
  • monitor the build-out process
  • tie up loose ends

Another way to hold down costs is to trim your expectations. A smaller, energy efficient home will save you money over a larger existing home. If you fall in love with the pricey upgrades, though, you could end up spending way over your budget.

The choice whether to buy or build has no clear-cut answer either way, but if you go into the decision-making process armed with information and with a realistic vision of what you want and can afford, you can come out ahead, and possibly save thousands of dollars.

And if you need extra cash, why not let Billshark review your bills for free? If we don’t save you money, you pay nothing!

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