5 Unexpected expenses when building a custom home.
EDUCATION
I hope that you are doing well! I wanted to take a moment to address a few budget items that you will need to keep in mind. Your builder or lender may not address these thoroughly. These items can totally wreck your budget if you don’t plan for them. I encourage my clients to be realistic about their numbers while setting clear expectations during your build. If you have been following me for any amount of time, you know that I feel most people end up with a home that doesn’t meet their expectations simply because of poor planning. Please include these hidden items in your overall budget when building your home.
Land Prep You will need land to build your home on. If you are buying your own land or already own it free and clear, it is probable that you will need to prepare the site for construction. You will be responsible for excavating and clearing the lot. If there are trees that need to be taken down--you will have to pay for it. Existing structures that need to be torn down--more money. In addition, and any debris removal and fill in dirt that will be needed to prep the land, you will have to cover the cost. Thinking of a basement? That will be more money. Plan accordingly ahead of time.
Landscaping When you build a new home your lot will be a blank slate. Depending on the type of lot there may be tree stumps that need to be removed or even if there was grass prior to construction--months of trucks driving over will destroy it. If you are building in a community with an HOA, keep in mind that you will most likely be required to finish the homesite to the standards of the community prior to moving in. I always recommend budgeting for sod over seed. It can take 3 full years for seeds to fully mature and over proper coverage. Please don’t skimp here. In addition, mature palm and myrtle trees are very expensive. Trees can easily cost hundreds and thousands of dollars. You will need mulch, lighting, hardscapes, and various plants and trees for a polished finished look. Don’t underestimate how much it will cost. Don’t forget the driveway! I have seen many people end up with a dirt drive away or gravel when they dreamed of pavers or textured concrete. Why? Well, they didn’t know that a long winding driveway would cost thousands of dollars.
Window Treatments Many people have no ideas how much coverings and treatments can cost. I am not speaking of draperies and panels but starting with the basic coverings that will create privacy and limit harsh sun rays from entering the home. When you build custom plans, often with custom windows, that will require custom sized window treatments. While mini blind and 2” faux wood blinds may have worked in your apartment or product built home--these solutions will not work in all cases. There are many highly decorative and functional treatment options that should be considered. They will cost money! Even if they are included in the build price, you can easily add $10,000 to $30,000 to an entry level custom home price.
Furniture Everyone wants a basement on the east coast. Guess what, you gotta finish it.. That’s money. Everyone wants a large living room and master bedroom. Media rooms and craft rooms while they are great to have….you have to furnish them in order to use them. Most people have know idea just how much money it can cost to furnish a house. Even if you buy everything from Pottery Barn--which is not high end furniture you can easily spend $15000 on a guest bedroom. On average, quality well curated furniture can start around 20% of your home purchase or build price. Spend 1 million dollars and you can expect to spend around $200,000 on furnishing alone. This is a rule of thumb not a requirement. Work the number, show and work with a talented designer. You will quickly see how much furniture cost.
Moving Costs Don’t underestimate how much it will cost to move! Even a short local move or cross country move will need coordination planning and scheduling. Will you do the packing yourself? Do you have tons of small accessories that will need care and protection? Do you have large pieces of furniture and pianos? It is important to research, seek referral and estimates from various companies well in advance. I hate to be the voice of bad news, if you are moving from one larger home to another prepare to spend thousands of dollars. Please include moving costs into your soft cost that will be covered out of pocket. Wouldn’t you hate to have your dream home completed and have to wait 30 days before you move simply because you are short on cash? Not a good look.
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