Setting a budget to build a house requires a lot more than considering how much you can afford to spend. The cost of construction involves many factors, including the cost of living in Chesapeake VA. Understanding what affects the cost of building a house and how to determine what you can really afford will help you make the right decisions.
How Much to Budget for a New Custom Home
Rather than considering what others are spending, take a look at your family’s personal finances. That’s your starting place for determining your maximum budget for new construction. Most finance experts recommended spending no more than five times your annual income on a home, with a more realistic figure at three times your annual income. This will result in a mortgage payment you can afford without making major modifications to your current budget.
Related: The Difference Between VA, FHA and Conventional Home Loans
When deciding where to live in Virginia, you must also consider additional cost of living factors such as tax variations, commuting costs, typical costs of goods, etc. According to three economic sources, the cost of living in Chesapeake, VA is comparable to the national average. Food and transportation are statistically less expensive, while housing fits the national average, and health care is slightly more than the national average.
Of course, the area you choose, property location, the floor plan you pick, and the features of the plan all determine how much home you’ll get for that amount of money. Consider checking into programs designed to make home buying more affordable for qualified individuals as well.
Related: Building a House vs. Buying a House: Which is Better?
Things to Know When Building a House
Following these basic tips for building a house on a budget will help you get the most of every dollar you spend. Even if you can easily afford the cost of living in Virginia, these are still important things to know when building a house in general.
- Stick to the standard floor plan. Minimize changes and customizations to stay within the quoted budget from the home builder. Every customization, even ones that reduce the size or materials slightly, increases home building costs due to the new design work needed to adjust the floor plans.
- Choose a neighborhood with finished, graded lots that are ready to build on. Even when these lots cost slightly more per acre than raw land, you’ll save thousands of dollars (and weeks of waiting) for costly excavation and site preparation services. Raw land also runs the risk of failing soil tests and is often located far from sewer and water connections. Pre-planned developments are checked for all these problems first, allowing you to get straight to building with minimal land preparation costs.
- Limit upgrades on materials like countertops, flooring, and bathroom fixtures. Luxury marble countertops or flooring may boost the value of the home, but it also increases the cost. You can always add these upgrades after enjoying years of affordable mortgage payments thanks to a more budget-friendly building cost.
- Make the most of floor plans with less square footage since you’ll also enjoy a lower total price. Downsizing is a major trend even among families that still have children at home, but you’ll definitely find it easy to fit into any of our floor plans when everyone’s off to college. If you need space to host guests or for aging parents to move in later, even our smallest and most affordable home designs feature a minimum of four bedrooms.
- Don’t be afraid of multi-story building. Multi-story floor plans minimize the initial footprint for savings on pouring the foundation. Plumbing and electrical wiring is relatively easy to run vertically between the two floors rather than over a larger horizontal area. Many homeowners find that it’s less expensive to add square footage on a second story than by expanding the first floor. That’s why most floor plans designed by Kroll Residential are two-story. We do also offer a couple ranch style homes.
Explore our floor plans today and request quotes on any of the homes that pique your interest. Here at Kroll Residential we’re committed to helping you stay within your budget to build a house.