(Note: the prices and calculations in this post have been updated for 2019).
Without a doubt, the most common question I’m asked is “How much does it cost to build a custom home in the Colorado Springs area?” As a custom home builder, it’s imperative that I have a solid grasp of the answer; the success of my business depends on it.
In 2019, my response is this – “Here in the Colorado Springs area, we typically build somewhere between $140/sq ft and $160/sq ft.” However, as we delve into this topic a bit, it’s important to keep in mind that there are significant variables to this answer; you cannot simply apply this number to any style or type of home without considering a number of factors. It’s also important to note that this price parameter does not include the cost of the land to build on, nor does it include either your tap fees or installing a well and septic system. These costs are outside the scope of the square footage price. Lastly, the selections and specifications that are included for the home will have a significant effect on the build price.
For example, a quality carpet, installed, runs in the neighborhood of $4.50/sq ft, whereas a site finished solid hickory floor is in the $8.00/sq ft range, and a tile floor on a subfloor installs around $11/sq ft. If just the decisions in flooring can have a five-figure impact on the budget, how much more cabinets, appliances, counters, plumbing and electrical fixtures, and so forth.
The single biggest factor in an efficient build is a basement. Without a basement, the cost per square foot will go up dramatically. Whether the home is on a “slab on grade” (which is rare for Colorado Springs) or on a crawl space, your cost per square foot will go up dramatically if you eliminate the basement portion of the home. Typically we find that a house built without a basement will be closer to $190/sq ft.
Keep in mind that the larger a home’s “footprint” becomes, the less cost-effective it becomes. Why? Bigger homes require more excavation, more foundation, more roof, more exterior walls filled with insulation and covered with plywood and stucco and windows, and so forth. There is economy of scale in going up to two stories (as opposed to what’s typically called a “rancher,” which refers to the main level). The more vertically oriented a build, the more economical the build will be, all else being equal.
Regarding basements: potential clients almost always want a square foot pricing quote that includes a finished (or mostly-finished) basement. So if you leave any portion of the basement unfinished, you can deduct a certain amount from the overall square foot cost.
Here’s an example to illustrate: let’s say John and Suzie Smith want to build a 5,000 square foot home, with 2,500 square feet in the walkout basement, and 2,500 square feet on the main level. Assuming the basement is finished, their build cost would be projected to be around $750,000 (5,000 square feet x $150/sq ft). If they choose not to finish the basement, their projected build cost will be about $650,000, because we take the $750,000 projected build cost, and subtract the cost of finishing the basement, which is around $100,000. (Generally, you can use a $40/sq ft multiplier for finishing a basement, so in this case, we take 2,500 square feet and multiply that by $40/sq ft, giving us $100,000). So with an unfinished basement, the client would incur $650,000 worth of costs but have only 2,500 finished square feet to show for it so this particular home would have a build price of has $260/sq ft. This number is nearly double the bottom end of our price per square foot range. However, if the client were to add another $100,000 into the project to cover the cost of finishing the basement, their price for the home as a whole increases to $750,000, but the price per square foot plummets from $260/sq ft down to $150/sq ft. That’s a huge difference!
There’s a myriad of other factors as well, including:
Economy of scale: the more square foot the home has, the more economy of scale can be achieved.
Roof pitch: a roof pitch of 6:12 or lower will keep roofing costs in check, whereas roofing costs increase exponentially as the roof pitch increases when it goes over a 6:12 pitch.
Lot condition: homes built on a steep lot will have additional costs associated with them.
Uncounted space: garages and decks are typically not counted in square foot pricing, so homes with larger garages and decks will see an increased cost per square foot, as the square foot cost necessarily absorbs and reflects the costs of those “uncounted” areas.
Level of finish: as mentioned earlier, there’s the level of finishes in the home, the ratio of wood vs. tile vs. carpet, the quality level you pick for your countertops, fireplaces, plumbing and electrical fixtures, and so on.
Typically, I find that most folks I speak to ask about our build price on the very first phone call. It’s the easiest and most efficient way for the client to qualify (or disqualify) a builder as a candidate for their project. Is it reasonable for the client to expect a builder to have a quick answer to the question? Absolutely. But it’s also important for the client to understand that until some discovery has been performed (finding out what the lot looks like, where it’s located, what level of finishes the client wants, etc.) there can be a bit of flux in that value range.
Paramount Homes is a Colorado custom home building contractor that builds new homes across the Pikes Peak region, including Colorado Springs, Monument, Castle Rock, Woodland Park, and more. With over 30 years of experience, we have built and remodeled over $40 million worth of projects. Call us at (719) 331-4116 or contact us online for a quote or more information on building your dream home.