How much did it cost to build a new home in 2024? MABA MassachusettsRealEstat FirstTimeHomeBuyers MaByerAgent

Construction accounted for sixty four point four percent of the average home price last year the highest figure on record according to the 2024 Cost of Construction Survey from the National Association of Home Builders. But what exactly goes into homebuilding costs, and how do those costs translate to profits for builders and home prices for buyers? Here’s the breakdown for the average new construction home in 2024:

Site work

Site work accounts for seven point six percent of the total construction cost, or an average of $32,719. That includes building permit fees ($7,640), water and sewer inspection fees ($6,260), architecture and engineering ($6,480) and an impact fee ($6,367), with other miscellaneous site work costing about $5,972.

Foundations

Excavation, foundation, concrete, retaining walls and backfill cost over $43,000, while other foundation expenses add up to $1,747. In total, the cost to lay the foundation for a home makes up ten point five percent of the total, or about $44,748.

Framing

 Framing expenses include lumber, which makes up the bulk of the building cost. Framing makes up eleven point six percent of the total cost, or $49,763, which is the highest line item on any construction expenses breakdown. Meanwhile, trusses (which are roof framing components that are pre-made and brought to the job site) cost $12,903, or three percent. Additionally, sheathing, or the plywood that makes up the outside shell of the home, is $6,513, while additional metal and steel needed for construction can cost $1,718. In total, framing can be over $70,000, or sixteen point six percent of the total building funds.

Exterior finishes

On average, exterior wall finishes for example, siding or bricks are $24,450, and roofing costs $16,732. Windows and doors and other exterior finishes cost $1,803. That means exterior finishes cost $57,510 and make up thirteen point four percent of the total.

Major systems

 Plumbing, electrical and HVAC make up a big chunk of the building budget for a new home, with the most expensive being electrical at about $27,383, or six point four percent of the total cost. Plumbing can cost $27,180, or six point three percent, while windows and doors run $15,990, or three point seven percent. With those costs, plus additional assorted expenses, installation of major systems costs $82,319, or about nineteen point two percent of the total building budget.

Interior finishes

 There are many components that make up the interior of a home, but the most expensive is usually cabinets and countertops at $19,056. Other interior expenses include insulation ($6,992), drywall ($13,962), interior trims, doors and mirrors ($12,920), paint ($11,150), lighting ($5,392), appliances ($7,499), flooring ($15,388), plumbing fixtures ($7,922) and fireplaces ($2,378.) Added up, interior finishes cost over $103,000 and make up twenty four point one percent of the total.

Final steps

 Even when a house is fully built, there’s still more work to be done outside. Landscaping can cost $9,239, while outdoor structures like a deck, patio and porch cost around $4,722. A driveway is $9,635, while general cleanup costs $3,183. Combined, these final steps tally around $27,710 and make up six point five percent of the total expenses.

Profit

 With all the above expenses added together, the average cost to construct a new home in 2024 was $428,215. But that isn’t the only expense to take into account in order to understand how new homes are priced. Firstly, before construction can even begin, the average finished lot costs about $91,057, while financing costs $10,220. Overhead and general expenses cost $38,248, while marketing costs $5,633 and sales commissions are $18,995. All of these expenses, plus the profit for the builder, add up to the price passed along to the consumer. In 2024, the average homebuilder had a profit margin of 11%, or $72,971, up from ten point one percent in 2022. That equates to a total sales price of $665,298.

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