New Construction Home Pricing 101

When you start your new home search many buyers are uncertain with what makes up the total price of a newly constructed home. Many are familiar with the used home market that shows the listing price of what that seller is asking for the home.  Well let’s  take the mystery out of it for you! Here are the 5 key components that make up the price of a new construction home. 

Base Price

One of the first things you’ll decide on is which home plan fits your needs. Depending on the community this could be choosing between 2- 6 home plans offered in the community. Important must haves like bedroom and bathroom counts, square footage, kitchen layouts, home offices or main level primary suites will determine the home that’s right for you. Each home plan will have a base price. That base price is the price of the home with the included standard finishes often listed on a builder’s features sheet. The base price is your starting point.

Elevation Styles

Typically, an option that needs to be selected on a single-family home or a detached condominium, is the elevation. The elevation  is the exterior style of the home. A builder will usually have several elevation styles to choose from at each community.  The cost of the elevations differs depending on the materials and architectural features. Materials like bricks, stone, columns, patios, cedar shingles, dormers, etc. are just some of the things that factor into the cost of an elevation. Additionally, the builder will have color packages determined for the exterior of your home and occasionally, due to material or labor costs, those prices may vary as well. In a town home or attached condominium community, this is not a price or selection concern that the buyer needs to make as they are predetermined by the builder. 

Home Site Premium

Now that you’ve picked the perfect home, where are you going to build it? New communities are designed and laid out ahead of time so it’s time to review the community plan and see what home site locations are available that fit into your budget. In a town home community, the options could be as simple as an end location or a view over the community park. In a single-family community, the home site pricing takes into consideration the lot size, location on the street and what the home faces or backs up to. With this step and the ones to come you’ll want to have a clear list of what are your must-haves and prioritize your budget for those features.

Structural Selections

While it can be tempting to want to select all the bells and whistles on the interior of the home, it’s important to start with the core structure of your home and those larger ticket items that are hard to change or can’t be changed after you move in. To simplify, think about how much easier it would be to change out your kitchen countertops than to add an electric or gas fireplace in the middle of your home. That is where the all-important structural selections come into play.  A professional building company will take into consideration each plan and offer alternate layouts or additional spaces that may enhance the home plan like an extended sunroom, ceiling accents, bay windows, and additional bathrooms.

Final Selections

Quartz, and Tile, and Lighting, oh my! Let the fun begin, it’s time for your visit to the Design Studio where an expert designer will meet with you to plan out the final interior design selections of your new home. This one-stop-shop is the ideal situation for a homebuyer to view all the options in one location. No more running all over town to look at samples.  A reputable builder will also vet and test out products for performance, only offering the best  that stand the test of time. Your Design Studio consultant meets with home buyers daily and is knowledgeable about the latest styles and can help you assess your budget and prioritize the things that are most important to you. Your electrical and low voltage  plan will also come into play at this time so you can properly equip your home before the drywall and flooring go in and avoid hassles in the future.

Now that we’ve reviewed the 5 components, let’s look at a quick scenario:

Base Price: $459,990

Home Site Premium:  $15,000

Elevation: $16,500

Structural Selections: $32,550

Finish Selections $29,800 

Your Home Price $553,840

But wait…there is more, what about Quick Move-in Homes?

Congratulations you’ve hit the jackpot when it comes to new construction homes. Builders often only allow for a select number of homes to be built ahead of time without a buyer and they are commonly referred to as a Quick Move-in home.  This home gives you all the benefits of a brand-new home without the typical build time. If your new home consultant advises you of a quick move-in home opportunity this will likely include all the previously mentioned pricing and selections. In short, if you love the home and the price, you are all set. Sign your purchase agreement and schedule the movers!

Now that you know the 101 on what makes up the price of a new construction home, we’d love to connect with you. We know buying a home is a very personal experience and every situation is unique. We are confident that our knowledgeable team can help you every step of the way in building your dream home.

About the Author

Robertson Homes, founded in 1945, has had the pleasure of building and developing over 65 communities, and building over 4,000 homes in Metro Detroit. We’ve been awarded by the HBA of SE Michigan as Developer of the Year, Builder of the Year, Development of the Year as well as multiple Interior Design Project awards.  With a dedication to quality and innovation, Robertson Homes is devoted to building unparalleled communities, refined condos and stunning single-family homes while placing the customer first.