
The Average Cost To Build a House in 2022

The Average Cost To Build a House in 2022
How much does it cost to build a house in 2022? What are the factors to consider when determining the estimate for your next construction project?
Estimating home construction costs doesn’t need to be complicated or time consuming, especially if you have the right information and tools to guide you.
So if you’re a general contractor, estimator, or homeowner looking to budget for your next home construction project, here’s what you’ll learn by the end of this page.
- The average cost to build a house
- Factors to consider when building a home
- How to ensure accuracy of your construction budget
Average Cost To Build a House
During the course of the COVID-19 pandemic, labor and supply shortages have led to an increase in building costs. The shortage was driven by more people spending time at home and doing DIY home projects.
Other factors that can contribute to pricing are your location, design, and size of the building. On average, you could spend between $201,000 and $310,000 to build a 2,000-square-foot new home.
In the table below, you can compare the average costs of building a house.
Cost To Build a House - Per Square Foot
On average, an American family with three to four members can fit comfortably in a 2,000 square foot home. As shown below, the construction costs per square foot are around $150 on average. Effectively, construction costs for a home for a family of four should be $300,000.
If aiming for builder-grade home construction, the lower cost range will be most relevant. Customized luxury construction will be in the range of $500 /SF. or more depending on the features of the home.

For builder-grade or mid-grade home construction, expect the following costs depending on the size of the home:
In the United States, the typical cost per square foot varies based on the region or state. Census Bureau data below indicates the differences between regions:
Cost to Build a House - By State
Location is one of the largest factors in home construction costs. Areas with higher cost of living equate to higher costs in land, materials and labor. Specific regions have union labor for construction which charges a premium compared to non-union. In the table below, explore the most affordable states to build a home and how much it costs to build an average 2000 SF. home.
Costs to Build a House - Based on Number of Bedrooms
For wood-framed homes, a 1-bedroom house can cost between $80,000 - $400,000 for 800-1000 SF.Building a larger home with higher-end materials will increase construction costs.
A 4-bedroom wood-framed home that is 2,000- 2,500 SF will range between $200,000 - $421,000. The price will vary depending on the materials selected and the features of the home. For example, using builder-grade materials or building a smaller home should lower the costs.
The Pre-Construction Cost to Build a House
Some of the factors that impact pre-construction costs are the house plan, land condition, design, demolition costs, and building permits. Overall, 10%- 25% of construction costs may be spent on pre-construction.
Below are some of the pre-construction costs to consider before starting a home building project:
Local Fees and Building Permits
A building permit is required when building a new home or completing an addition to an existing one. In general, the cost of a building permit franges from $1,200 to $2,000.
Construction Project Management Fees
A construction manager ensures the project is executed according to plan. On average, a construction manager charges 5% to 15% of the project's total cost.
Demolition
Expect to pay between $3,000 - $25,000 for demolition Several factors affect demolition cost including the house size, location, and presence of asbestos or lead paint.
Architectural Plans
Building a dream home begins with the creation of architectural plans. Plans can cost around $5,000 depending on the complexity of the house and the qualifications and experience of the architect.
Impact Fee or Local Charges
Before beginning construction, impact fees, permits and local fees are imposed by the local government. The fees can cost around $3000 depending on the location of the property.
Land
A variety of different factors, including the lot's size and location, can influence the cost of a lot. According to Home Advisor's data, the average cost of land is $76,500, but some undeveloped rural lots are priced as low as $3,000. Additionally, anticipate spending $1,500 - $3,000 on land preparation and site work before construction begins.
Water and Sewer Inspections
An inspection of the sewer line can cost between $227 - $797. Costs vary depending on location and the experience of the inspector. Before performing work, it is always recommended to get a price quote from multiple companies that may potentially perform the work.
Estimators
General contractors that are hiring estimators can expect to pay the following in annual salary according to Zippia and ZipRecruiter:
Labor Cost To Build A House
Around 40% of the total cost to build a house is attributed to labor. These labor costs are often influenced by a general contractor's buying power, the size and complexity of the house, and the property’s location.
Cost To Build A House - Home Exterior Materials
The exterior finishes contribute to the overall look and feel of the home just as much as the exterior design. Finishes include exterior walls, roofing, windows, and doors.
Exterior finishing costs between $40,000 to $60,000. However, the number of openings and types of exterior finishes will affect the final price.
For more in-depth detail on the cost ofexterior materials, refer to the table below:
Cost To Build A House - Interior Materials
Interior finishes often cost between $50,000 - $175,000. Interior elements include HVAC systems, flooring, insulation, plumbing, paint, and fixtures.
For more detail on the costs of interior materials, refer to the table below:
How to Reduce the Cost to Build a House
Reduce Pre-Construction costs
For general contractors trying to reduce costs, the pre-construction process is one of the highest sources of overhead. Manual and digital takeoffs are both costly and time-consuming and can cost around $66,816 in annual overhead.
With Togal.AI, automate up to 80% of the takeoff process with machine learning models. Estimates can be finished faster while reducing extra overhead.
Ensure Accuracy of the Estimate
Inaccurate estimates can lead to cost overruns. For a contractor, this can result in disputes and loss of profit. For homeowners, cost overruns can cause the project to go over budget and derail finances.
Preventing cost-overruns can be done by eliminating manual, error-prone calculations. An AI estimating software such as Togal.AI can interpret plans with 97% accuracy in less than a minute.
Consider Alternative Materials
The materials used can heavily impact the cost to build a house. With a small budget, consider using cheaper, more available, alternate building materials that are similar in quality. Rcycled but otherwise structurally robust materials such as steel can be a cost-effective solution.
Work with Qualified Specialists
When hiring estimators, architects, or interior designers, look for experienced and certified specialists. Having excellent qualifications and experience will provide better quality.
Maintain the Project Timeline
Delays in home construction completion can lead to increased total project costs. To ensure the timeline is maintained, follow below:
- Outline clear timeline expectations in the contracts. Document and communicate with everyone involved.
- Document and communicate to keep everyone informed.
- Review the schedule on a regular basis. It is important to be aware of potential delays and to strategize to mitigate risks.
Final Words
Building a house offers many benefits. It's often cheaper and easier to customize an existing home compared to buying a newly built home. Before building, first determine the cost and budget.
To reduce the cost to build a house, plan meticulously and work with professionals. Leverage the power of Togal.AI’s efficiency when conducting cost estimation. Refer to updated prices based on factors like location, building size, labor costs, and materials.
Need help estimating the costs of a home construction project? Book a demo today with Togal. AI.