Here are some tips for creating a budget for your custom home.
A well-structured budget ensures you get the home you want without financial surprises. However, setting a budget for a custom home can feel daunting. It’s not just one number; it’s a series of small numbers that add up to a big one. That’s why we’ve written this blog on how to build a budget for a custom home. From land costs to construction loans and finding the right builder, we’re here to guide you through the process. Here are some tips for creating a budget for your custom home.
Establish a Price Cap
The first step is determining how much you’re willing to spend and what you can afford. You’re not just paying to construct a custom home; you’re paying for the entire process. What’s included in your budget? There are some variables, but there are some common factors that you typically need to add to your total budget, such as:
- Land costs
- Permits and fees
- Construction costs
- Utilities and connections
- Interior and exterior finishes
- Landscaping and driveways
Many people underestimate costs, thinking a smaller budget is enough, especially for finishes like tile, flooring, and lighting. A reasonable budget prevents these surprises. It never hurts to check prices on certain elements to see where your tastes lie. Having your budget in place is something you must do before designing your home.
Financing & Construction Loans
You might think financing depends on your financial status, but most homeowners finance their custom home build regardless of their financial status. That’s why working with reputable mortgage companies that offer construction loans is crucial. Understanding what construction loan rates are in your area and how they impact your budget is equally important.
Leveraging Financing
Financing isn’t just a way to pay for your home; it is a tool. Mortgage lending for new construction is unique, and not all lenders do it as smoothly. Ask us for our list of lenders, and we will let you know who does well in our area.
Plan for Change Orders
Change orders can impact financing, so it’s essential to have a plan. You can either plan for a buffer with your initial construction loan or have an agreement with the bank to take out an additional loan if needed.
It’s also important to make certain decisions early, as changing them later can be difficult and expensive. For example, changing flooring after installation, adding more recessed lighting, adjusting electrical plans, or upgrading materials like tile, countertops, and cabinetry at the last minute can be costly.
Prioritize Needs over Wants
When building on a budget, you must differentiate between your wants and needs. Only you can determine what is a need versus a want, but we have some suggestions.
Your needs can include high-quality windows, electrical and lighting plans, specific flooring, layout, and designs that cannot be changed. However, your wants can include patios, landscaping, trim, built-ins, and extras like in-law suites and detached garages.
Contact Accessible Home Builders Today
Here at Accessible Home Builders, we’re proud to say we’ve been building and remodeling homes since 1994. We’ve serviced Rehoboth Beach, Lewes, Selbyville, Millsboro, Georgetown, Laurel, and more communities within Delaware in that time. We work to guarantee a high level of professionalism, dedication, and the use of quality materials to ensure our customers have the homes they deserve.
To get in touch with us, give us a call at our office at 302-663-0464, send us an email at info@accessiblehomebuilders.com or visit us in person at 28412 DuPont Blvd, #103 Millsboro, DE 19966. Follow us on Facebook, Twitter, Linked In, and YouTube to stay updated on what we’re up to next!