The average home building cost in the Golden State in 2023, will range between $400,000 – $2,400,000. Depending on your choice of style and area, home building costs can reach millions. Also, on average, homeowners spend 9 – 12 months building a home.
Is it cheaper to build a house in California? Or should you buy a new house?
Can I Build My Own House in California?
Yes! If you have an ideal piece of land, in an area you want to live in, you can definitely build your own house in California. You have to budget for the time and the cost of building a house though.
You will also need permits to build. Permit fees depend on the home value or the construction area. Rarely will the permit be charged at a flat fee. Permit laws vary across counties in California. Refer to your local county’s website or office for more information on home building permits.
» Permit Costs: Read more about home building permits.
Is it Cheaper to Build or Buy a House in California?
Generally, buying an existing home is cheaper than building a new one. But remember, by building your own home you get a brand-new home, customized to your needs.
The cost of building a house in California ranges between $400,00 – $2,400,000, with the state average at $1,350,000. This figure does not include land costs, excavations, permits, and other expenses. Home building prices in California can reach millions depending on the build type and customizations.
If you’re considering buying a home, the median sale price (as of Jan 2023) in California is $695,300.
Owner-built homes can take up to 12 months to complete. Even if you hire a contractor, you will spend 9 months building your house. So, as per California real estate market, new home construction is time-consuming.
» California Homes For Sale By Owner: Shop FSBO California homes directly from the homeowners.
How Much Does it Cost to Build a House in California?
The average cost to build a house in California per square foot is $500 sq. ft., excluding land costs, permit fees, excavations, and other costs.
Average Cost of Building a House in California
|Average Home Building Costs in California||$1,350,000|
|Minimum (800 sq. ft.)||$400,000|
|Maximum (5,000 sq. ft.)||$2,500,000|
|Average Range||$400,000 – $2,400,000|
Average Cost to Build in California Per the Number of Bedrooms
Below is the table showing the cost of building a home in California per the number of bedrooms:
|Number of Bedrooms||Average Cost Range to Build a House in California|
|1 Bedroom||$160,000 – $900,000|
|2 Bedrooms||$200,000 – $1,200,000|
|3 Bedrooms||$400,000 – $1,620,000|
|4 Bedrooms||$500,000 – $2,400,000|
Average Cost to Build a House in California by Square Footage
Below is the table showing construction cost per square foot in California for varying home sizes:
|Home Size||Average Price Range|
|1,000 sq. ft.||$500,000|
|1,500 sq. ft.||$750,000|
|2,000 sq. ft.||$1,000,000|
|2,500 sq. ft.||$1,250,000|
|3,000 sq. ft.||$1,500,000|
California Home Building Costs Breakdown
To paint a better picture, here is a house building costs breakdown for a 2,500 sq. ft. house in California:
Hard Costs to Build a House in California
Hard costs comprise expenses directly involved in the home-building process that play a direct role in estimating the project’s completion.
1. Material Cost to Build a House: $125,000
Building materials make up approximately 50% of the overall building prices. You can expect to spend about $50 per square foot on home-building material costs.
The cost of building materials went up 5% to 10% in 2022 compared to 2021. This was due to the increased demand for siding and other building materials and longer delivery timelines.
Home building prices are expected to be volatile in 2023. Ken Simonson, Chief Economist at Associated General Contractors of America, expects price hikes and shortages to ease for some products, and to remain volatile for others in 2023.
“Cement and concrete products are likely to have continuing shortages as the nation has not added any cement production since 2009 while demand is growing, particularly from infrastructure projects.”– Ken Simonson, Chief Economist at Associated General Contractors of America
Here are the material costs you must account for while building your home in California:
- Flooring: $9 – $32 per sq. ft.
- Drywall: $0.5 – $1 per sheet
- Siding: $2 – $50 per sq. ft.
- Lumber: $650 – $1,100 per board ft.
2. Contractor(s) Charges: 10% – 20%
You need a contractor or a firm to oversee the construction process. Contractors hire other professionals, estimate the costs, and complete the construction on time.
A general contractor hires several other professionals involved in the home-building process. They include:
- Floor installers
- HVAC installers
- Carpenters, etc.
A contractor charges around 10% to 20% of the total construction value. A general contractor’s fee depends on several factors, such as property type, detailing, materials, and workforce. Apart from a contractor fee, ensure to account for each professional’s hourly rates.
Below are the average hourly rates of home building professionals in California:
3. Electrical Costs: $7,500 – $12,500
On average new construction electrical cost per square foot is $3 to $5. This amount includes both the rough-in as well as the finishing work.
The amount you spend on electrical work will differ depending on the property size, type of wiring, wire material, etc. To save money you can DIY the electrical work, but you will still need an electrician to check the connections. Some electricians can charge up to $120 per hour.
4. Roof Installation Cost: $5,300 – $59,600
Roofing costs depend on the choice of roofing material, the slope of the roof, and the size of your house. Below is the table showing roofing costs per square foot in California for various roofing materials:
|Roofing Material||Avg Cost Per 100 Sq. Ft.|
|Asphalt Shingle Roof||$212.24 – $344.88|
|Tile Roof||$994.85 – $1591.76|
|Wood Shake Roof||$696.40 – $915.26|
|Slate Roof||$961.69 – $2387.64|
5. Plumbing Cost: $12,000
Plumbing costs include installing plumbing fixtures such as toilets, faucets, wash basins, bathtubs, etc. Homeowners spend around $4.50 per sq. ft. in installing plumbing fixtures in new construction or $4,080 on average (national average).
You require a plumber to fix the pipes and lay the sewage lines. Apart, you need to install new machineries like washing machines, dryers, and geysers while custom building a home in California.
6. HVAC Installation Costs: $12,500
Homeowners pay $1,500 to $12,500 for installing a new HVAC system. This cost depends on several factors such as the size of the cooling area, the type of system, the brand, the addition of zones, etc. All these additional factors can increase the installation cost by $2,000 or more.
Soft Costs to Build a House in California
Soft cost in home construction comprises costs that do contribute to the building process directly. They include costs like permit costs, design costs, etc.
1. Land Cost: $39,000 Per Acre
Before you build your house in California you need to shop for land to build it on. You will incur two costs related to land:
- Land Purchase Cost: The average price per acre in California is $39,092. The cost of land depends on the size of the house you wish to build as well as the location.
- Preparation Cost: You need to clear the land and level it before starting the construction process. Land preparation costs can be anywhere between $1,500 – $3,000.
🤔 Is it cheaper to build a house in California if you already own land?
Yes. In most cases, building a house is in California cheaper if you own the land. You will incur only the cost of building the home. Plus, you can customize your home to your requirements!
» Land For Sale By Owner in California: Buy land to build a house near you.
2. California Home Building Permit Cost
In California contractors need a building permit to construct a new house. Construction or building permits are legal documents that authorize the house building process.
The permit costs, and building codes, vary per county and are usually charged based on the construction type, occupancy type, home building area, and project scope.
Some permits you may need along with their average cost are as follow:
- Building Permit: $1,000 to $2,000
- HVAC Permit: $250 to $400
- Plumbing Permit: $50 to $500
- Electrical Permit: $10 to $500
Building permit costs vary across counties. Refer to your local county’s websites to get the exact permit estimates.
3. Home Interiors: $20,000
Before you move into your new home, you’ll need furniture, electronics, utensils, silverware, and bathroom essentials. These may sound relatively cheap, but the costs can add up quickly.
The costs will depend upon your taste, quality of finishes, location, and the outlet you order from. For a 2,500 sq. ft. home, you should budget at least $20,000 on interior furnishings.
4. Home Interior Design Costs: $5,400
If designing your own interior isn’t your thing, you can hire an interior designer. A great interior designer will provide you with 3D views and renderings of how your home will look and feel before you finalize the finishes.
An interior designer will also order the right furniture, wall prints, rugs, carpets, artifacts, etc. based on your taste and functional requirements. They can also help you maximize space utilization.
But interior designers aren’t cheap. Budget $5,400 on average, but it can be more or less depending upon your requirements.
House Building Financing Options
If you have the funds to finance your dream house, you are welcome to skip this section. If not, then do not lose hope. Prepare a budget and get an estimate of how much money you need, then apply for one of the following home loans:
Home Construction Loan
There are two home loans specifically designed for home-building purposes. These include:
- Construction-to-Permanent Loan: This loan covers both land purchasing as well home building costs. Once the construction is complete and you move into the house, the loan is converted to a traditional mortgage of 15 to 30 years.
- Construction-only Loan: It is meant only for financing the home building, and does not cover the land purchase. After your home is ready, the entire loan amount is due. You either cover the amount by paying cash or taking out a mortgage.
A personal loan will not cover your entire home-building cost. Take out a personal loan to finance a specific part of the construction. Say, you forgot to account for landscaping while budgeting your home-building finances. In such a case, a personal loan can come to your rescue.
Home Equity Loan
This applies to homeowners who already have a home and want to finance the construction of a new one. Depending on how much equity you own in your existing home, you can finance the entire construction of your new home or a part of it.
Should You Build Your Own House?
If you own land in a location you want to live in, we highly recommend building a house yourself or hiring a General Contractor to build you one. Budget 9 to 12 months for planning and construction of your new home in California.
If you don’t own your own land in a desirable area, we recommend you house-hunt for turnkey homes in California and move in quickly.
Skip the hassle of building a house, and check out FSBO properties on Houzeo.com. Make offers, negotiate directly with homeowners, and move into your new home within a month.
Eager to Know How Houzeo Works?
We’ve got you covered. Check out the following video to understand how Houzeo works and why it is one of the best For Sale By Owner websites in the U.S.
What is Houzeo?
An overview of what the platform is all about
» NEED MORE CLARITY? Read these exclusive Houzeo reviews and learn why it is one of the best FSBO sites in America.
Frequently Asked Questions
1. How much does it cost to build a 2,500 sq ft house in California?
It would cost you $1,250,000 to build a 2,500 sq ft house in California.
2. How much does it cost to build a house on land in California?
It would cost about $300 to $500 per square foot to build a house in California.
3. How much does it cost to build a house from scratch in California?
Depending on the type and area, California home building costs range between $300 to $800 per square foot.
Resources for Buying a House in California
- What Do I Need to Buy a House in California: Check out our California home-buying guide.
- Best Time to Buy House in California: Discover the best time to buy a house in CA.
- How to Buy a House with Bad Credit in California: Learn how you can buy a house in CA with a bad credit score.
- For Sale By Owner Sites: Discover the best FSBO listing sites to find properties online.
- How Much is a Home Appraisal in California: How much does a home appraisal cost in California?
- Title Insurance California: Discover how title insurance works in CA.
- Is Owner’s Title Insurance Required in California: Discover what are your title insurance obligations as a buyer.
Resources for Selling Your Owner-Built Home
- List on MLS: Discover ways to list your owner-built homes on the MLS.
- Free MLS Listing: Read to know if there are ways to list on the MLS for free.
- Flat Fee MLS Listing: Check out how Houzeo’s FFM packages will save you thousands in commissions.
- Flat Fee MLS California: Check out the top Flat Fee MLS companies that will help you save thousands in commissions.
- California Real Estate Brokers: Check out our rankings of top real estate brokers in California.
- Realtors in California: Discover the top NAR-certified real estate professionals to sell your owner-built house.
- How to do For Sale By Owner in California: Want to skip the hefty real estate commissions? Read our guide on how to sell your house without a realtor in California.
- Cash Buyers for Homes: Sell your house fast for cash with America’s best cash home-buying companies in 2023.
- Flat Fee Realtor: Skip the listing commission and pay a flat fee to successfully sell your home with Flat Fee Realtors.
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