Saving Money When Building a Home –

Written by Andrew Morrison

money symbol in eyeball

When preparing to build a house, money is always a concern. How much will it cost? Where should you focus the money you have? These are basic questions which are always on the page for people as they prepare to build. Make no mistake about it, building a house will be the most expensive thing you ever do. For most people, it is the most in debt they will ever be and so allocating the funds wisely is very important. If you’re interest in saving money when building a home, read on.

The energy involved in having so much money tied up in one investment is the root cause for many people’s anxiety and stress when building. Making a few simple decisions up front could be the difference in how much that stress affects you. (image from

So what decisions to make? The reality of most homes is that a large portion of the money is spent before the house is even built. The design of the home has such a huge impact on the cost and should not be over looked. Too many people build homes far larger than they actually need. A home that is well designed will feel bigger than it really is.

There is no need for a so called great room in most homes. How many of us every entertain at the level that requires a dedicated party room in the house? Not many. Think about how spaces are used and design for that purpose. In many cases, you can double up on the room’s use. The point is, design to the smaller end of what you need and you will significantly lower the building price.

A second layer of the “design equals cost” equation is simplicity. The more intricate the design, the more expensive it will be. In no way am I suggesting that everyone build rectangular, single story homes with no character. I am, however, acknowledging the fact that you will spend more money on the home the further the design gets from “the norm.”

That is fine as long as you are aware of it. This is true for the initial cost of the home and the long term cost. Consider that the more valleys and hips you have in your roof, the more chance you have for a future roof leak. Again, K.I.S.S. which means Keep It Simple Stupid.

One place where a lot of money is spent in most homes is the kitchen. Many people want the new, larger than life appliances in stainless steel. Again, that is fine, but that is also expensive. Are you that good of a chef that you need the best of the best or are you buying it for the image it creates? Most of us can’t cook well enough to know the difference between the $3000 range and the $500 version. Once again, this is a place to buy what you really need and can appreciate for its function, not for the way it looks.

Electrical lighting and plumbing fixtures are another place where lots of money is spent. As long as the fixtures are safety rated and have good reviews, a light is a light. Okay, that is a bit unfair, but once again for MOST of us, it is true. I have built homes where the home owner has requested a $500 light fixture only to be totally satisfied with a similar fixture that sold for 1/3 the price. Buy quality, for sure, but you really don’t need that top of the top of the top of the line fixture in every room. The same goes for plumbing fixtures.

There are some differences in quality when it comes to fixtures and much of it is unseen. Solid brass versus plastic innards for example will make a fixture last much longer. Pay for the quality you need and don’t get suckered into the latest trend. No one really needs a 15 head shower stall!

Be careful of saving money by doing it yourself. Unless you are trained in running a job site or have some expert help, taking on the job of general contractor is probably not a great idea if your plan is to save money. You will be away from your place of work, thus not making money, and will be slower than a trained general contractor, thus costing yourself more money and time away from work. Either pay for the professionals to do what they do, or get the right training to do it yourself.

When I say the right training, I don’t mean go work for a contractor for five years before you tackle your own job. I mean learn everything you can about the construction trade and running a job site. Then you will be in a good position to save money as your own contractor.

There are a myriad of ways to save money when building a house. As discussed above, lights, plumbing fixtures, design, and appliances all play a big factor as do counter tops, cabinets, flooring selection and wall finish. Do your research. Come to the house from a place of what you really need, what you really want, and how much money you have. With those three things in front of you, you can make good decisions. I always suggest that the “what you want” column is where you find things you can cut out of the equation because what you need is more important than what you want when you only have a limited number of dollars to buy either with.

Finally, have a contingency fund. Things will always cost more than you think they will. Plan on having roughly 10% more money than you think you need in a separate fund that you can draw on as necessary to complete your job. Don’t spend more than 10% extra on each line item of your budget unless you are willing to pull some money from one line item’s contingency fund to use elsewhere. This extra cushion of money will help reduce stress as long as you don’t use it as a “free access bank.” Use it wisely.

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