How to Save Money When Building A House Of Your Dreams

Purchasing a home is possibly the largest event that you will make in your lifetime. Everyone is always looking for ways to save money when building a house because making the decision to build a home adds a large amount of complexity to the process.

light blue house with white porch and writing on it saying how to save money when building a house of your dreams.

You will have to worry about every detail from buying the perfect plot of land to choosing countertops that match your taste and lifestyle. It is a daunting task that can quickly become overwhelming if you don’t have the time and desire to stay on top of all elements of the project.

No matter if you decide to build, buy move-in ready, or remodel, there are some things you can do to make things fit your budget.  Here are a few tips to get the most affordable way to build a house!

Be Realistic during the Planning Process

Make sure you are being realistic about what you want and what you can afford. It is tempting to agree to add-ons especially if you are planning on this home to be your forever home.


As you draw up the floor plan consider the space that you need today and what space you will need in the future as your family grows. We all would like a room dedicated to wrapping presents and store wrapping materials, like in Aaron Spelling’s mansion, but for 99% of the population that is an extravagance that is not affordable.

Consider an open floor plan or multipurpose rooms to help meet all the items on your wish list; for example, an office can double as a hobby or crafting room. Be sure to calculate the price per square foot as you finalize your floor plan and look at comparable selling prices in your town to be sure that you are not putting yourself underwater before you even pour the foundation.

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Negotiate, Negotiate, Negotiate

You will want to negotiate everything from the land to the faucets. Typically when working with contractors you will be given an allowance for all aspects of the finish work on the house – appliances, flooring, lighting, cabinetry, countertops and more.

These contractors will often steer you towards vendors that they have established relationships with so that they can get a percentage of the purchase. Instead of using the allowance route, opt to research and purchase these items yourself so that you are sure that you are getting the absolute best price and warranty options.

This method requires a lot of conversation between you and your contractor to be sure that you are getting quotes for the correct amount and size of materials but the potential savings is worth the time investment. This

Get the most affordable way to build a house by looking at the big picture

Be sure that you are making decisions with the big picture and long-term in mind. For example, you may want a two story family room with large windows but this type of construction will lead to higher heating bills and expensive replacement costs for the windows down the road.

Also, consider the impact of your decisions on the potential resale value of the home in the future. While you may see a pool as a necessity, some buyers see it as a liability and will not pay a premium for that feature.

To ensure that you are getting the most affordable way to build a house, be as involved in the process as your day to day schedule will allow, do not blindly accept your contractor’s recommendations and keep your longer-term goals in mind. How have you saved money while building a new house?

Leave a comment with your tips and tricks to save money when building a house!

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  1. There is good information here, but as a general contractor working in the midwest, I would have to disagree with some assertions in the “negotiate” section. Allowances are a good way to help people know where the middle ground on finish materials is. If your contractor steers you someplace it is probably because they have given good service in the past, something that is more valuable to the customer than a few pennies saved on a faucet. If you suspect your contractor isn’t trying to save you money anywhere he can, get another contractor. Also, don’t use the big box home centers as a gauge of prices. Many of their products are cheapened versions of the manufacturers product lines. They often look the same but are not of the same quality you would find in say a plumbing supply, or electric supply house. Lastly, many times subcontractors don’t want to install the stuff you bought at Lowe’s or Overstock because they don’t know what it is, and they know you will expect them to be responsible for it’s performance.

    1. Hi Mark! I appreciate you comments. We are considering a move to the midwest. What would you say the average price per square foot is to build a house in 2019? We are just trying to consider our options in South Western Mi.

  2. Mrs. Smith says:

    Hi! I really enjoyed reading your article. I have also found that it saves a lot of money when building a house to use less angles, less roof lines and less foundation corners. The more square it is the cheaper it will be without compromising quality. I am looking for ideas on how to save money on materials or new materials that are out that are also good quality but can save money. Any thoughts?

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  4. Good ideas. However, you may want to also consider the things YOU can do. Almost anyone can paint their own ceilings and walls–and if you CAN’T paint your own ceiling, you might want to reconsider that soaring ceiling. Make sure you can change bulbs in your ceiling fixtures, too. If you are building, make sure everything is convenient for YOU! Washer/dryer in basement was NOT for me, so extra bedroom became laundry/office. My steps on the basement staircase are wide, and not steep. I have a wall oven because I can’t lift things out of a floor oven. Think over EVERYTHING. I need a walk in shower, since I cannot get out of a bathtub. Some time spent thinking about convenience in advance is much better than 20 years of putting up with inconvenience!

    1. Great thoughts. That is for sure an important part of the building process.