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Home Plans Cost Per Square Foot – Part II

I had previously published an article titled “House plans cost per square foot method“. It explained the misconception of the home plans cost per square foot method by homeowners. Surfing the web, I came across a website that had published that article. Here is an interesting response that grabbed my attention.

“This author clearly doesn’t get it. Yes, a take-off is required for estimated cost on completed house plans. But for those who don’t yet have completed house plans, this doesn’t work.

The author doesn’t seem to understand the idea that different levels of estimates are needed at different stages in the game. At an early stage, when one is considering what type of building to build, or whether they can afford it, the expense and time of a full take-off is idiotic. In fact, take-offs are usually done when a project is ready to build, making them useless for someone who hasn’t decided what to build. This author doesn’t present an alternate form of estimate for the undecided home builder who doesn’t have plans.

You think a person who works in Architecture would understand the difference between a conceptual estimate and a full construction estimate.”

Comment by B.S. – 1/2/07

home plans cost per square footBefore I respond, you should know that the comment is really by someone who left the initials BS. Personally, I found the response to be a bit humorous, since I did get it.

In light of this response, I will elaborate little more on the subject. There are only two levels of estimates that I’m aware of. There is the home plans cost per square foot method (CPSFM) and take-offs. Most people know about the CPSFM through presenting a basic brochure floor plan layout and elevation to a potential builder. The previous article was based on the fact that a homeowner has already decided on a home plan. Furthermore, the home owner is ready to build that house. So at that stage, take-offs are the best way to fine tune the cost of building the home. The goal was to educate the average homeowners on a basic level as to why the cost per square foot method don’t always produce the same cost on similar size homes.

Why builders use the home plans cost per square foot method

For the builders, home plans cost per square foot is a viable tool because there experience in building homes give them the knowledge to estimate a soft number to build per square foot based on the materials, finishes, and other variables that they are accustomed to using in their projects. The homeowner sometimes take the estimate as a hard number. In other words, if a builder quotes $125.00 per sq ft for 3,000 sq ft (totaling $375,000), the homeowner should expect that number to go up or down when the builder has more detailed information about the plan (a full set to review), degree of design difficulty, the finishes that the homeowner wants, and other issues.

Why homeowners should not rely on the cost per square foot method

When a home builder quotes a home plans cost per square foot to build, the owner may be thinking of high end  finishes, details, and other variables. Without first discussing these issues with the builder, the homeowner sometimes purchase home plans based on that initial conversation. Then, the homeowner follows up with the builder to go into more detail. This is usually where the initial reliance on the cost per square foot method by the homeowner is troublesome.

In more cases then not, the initial estimate is at the homeowners budget or slightly over if not more. If the estimate falls under the homeowners budget, then the cost per square foot method has served it purpose. The home plans cost per square foot method should be used as a guide only. It should not be taken as an absolute when you are in the market to build your next home. The CPSFM is a viable tool if used properly within the context of early stage planning.

Kirya Duncan, Building Designer