Along with the excitement of building a custom home comes the stress of creating the budget. Marrying your wish list with the actual cost of your vision can be stressful, and it’s a crucial part of the process. So, we asked our Project House: Austin builder Michael Wray, owner and founder of MidCentury Custom Homes, to help. Here are his tips on creating your very own custom build budget.
First and foremost, don’t try to create a custom build budget on your own. “It’s absolutely necessary to ask your builder to help,” says Michael. “One of the most valuable things a builder can do is give clients a reality check. They need to be prepared for every cost.”
The builder will help you create a list of costs, and some of what’s on the list may not have crossed your mind yet. “So much of the costs have nothing to do with the house itself,” Michael says. “For example, you have to acquire the lot. Then entitlement costs like permitting and utilities are big ones. You have electric service and water, and you have to decide between propane or natural. When it comes to utilities, you either have to pay fees or build the system yourself, so there’s a lot to consider.”
Create a Wish List
A great place to start is to list what elements of your home you consider important. That way, you can set aside larger chunks of the budget to ensure those features are prioritized. If you can’t decide, Michael has a few suggestions:
- Flooring: “Splurging on flooring is never a bad idea,” he says.
- Appliances: “If you spend a lot of time in the kitchen, spend the extra money on the range or refrigerator you want,” he says.
- Master bath: “Get a nice shower. That’s value that people can see, so the house will be worth more if you sell it later,” he says.
- Classic elements: “Consider things like trim, interior doors and paint treatments,” he says. “Think twice about anything that can be construed as trendy. You can never go wrong with the classics.”
Include a Buffer
There are always surprises during the construction process, so plan for contingencies in your custom build budget. “In our current environment, material costs never go down,” says Michael. “Most materials go up in price annually, regardless of supply or demand issues. For this reason, we build unexpected things into our price, and it’s usually a minimum of 5%.”
Lastly, it can be easy to focus on the fun parts of the build and forget about the cost of the process. “Do not underestimate the cost of landscaping and the cost of site work, like preparing the lot,” Michael says. “Rarely does anyone find a lot that’s completely flat. Even driveways can cost a lot.” The lesson? Don’t forget to budget for the elements surrounding the house, too. If you keep all these tips in mind and get the right help, you’ll be on your way to your dream home!
COMING SOON! Keep an eye on midcenturycustomhomes.com for a new feature they’re working on called Midcentury University. It will be an online resource for people interested in building, and you’ll be able to ask questions about creating your own budget.
Learn more about our Project House: Austin designer and her 5 favorite MCM design elements.