The Expense Involved in Constructing a Residential Property
Building a house in the United States is an exciting venture, but it's essential to understand that the choices made during the building process can significantly impact the estimated cost. According to the National Association of Home Builders (NAHB), the average cost breakdown for building a single-family home in the US typically includes seven major stages.
The Seven Stages of Building a House
- Foundation: The foundation stage, which includes excavation, building the foundation, retaining walls, concrete, and backfill, costs around $4,000 to $30,000, with an average cost of around $7,300.
- Framing (structure): Framing, which includes sheathing, trusses, and sometimes roofing, typically costs between $10,500 and $48,000, with an average cost of around $23,000.
- Permits and Fees: Permit fees and impact fees, essential for ensuring compliance with local regulations, can range from $1,000 to $8,000. The total cost, including these fees and utility hookups, can add several thousand dollars to the project's cost.
- Utilities Connection: The cost for water/sewer and electric connections varies depending on the property, but it's an essential factor to consider.
- Materials: Lumber, concrete, drywall, insulation, and other materials are significant cost drivers. The prices of these materials can fluctuate due to shortages.
- Interior Finishes: This stage includes drywall, insulation, painting, interior trims, lighting, cabinetry, appliances, flooring, countertops, plumbing fixtures, fireplace, and more. It can cost up to $75,259, or 25.4% of the total expense.
- Exterior Finishes: Exterior finishes, including wall finishes, roofing, windows, doors, and garage doors, can cost around $41,690, which equates to 14.1% of the total cost of building a house in the US.
Factors Affecting the Cost
Some choices may help lower the estimated cost, while others may increase it substantially. For instance, hiring a professional for the framing stage, due to its complexity, is highly recommended.
The overall cost of building a house in the US depends on individual preferences and budget. The major systems installation phase, involving plumbing, HVAC, and electrical wiring, can cost up to $43,668 or more, equivalent to about 14.7% of the project's total cost.
The exact costs can vary depending on the type of foundation and other factors. Building costs have risen sharply in recent years, with the median construction cost per square foot rising from about $120 (2018) to $168–$200 in 2025, driven largely by material price increases, labor shortages, and regulatory pressures.
Total average construction costs for a typical new single-family home in recent years reported by NAHB range from approximately $428,000 to $645,000 depending on size and region. Thus, a rough stage-wise breakdown from NAHB-backed data would show the foundation and framing as major line items, with permits, fees, materials, and utilities as important cost factors adding to the total. The exact figures vary based on location, home size, foundation type, and current market conditions.
Investing in real-estate, specifically building a house in the US, requires a keen understanding of the various stages and their associated costs to make informed decisions. The industry of house-building includes stages such as foundation, which may cost between $4,000 and $30,000, and framing, whose expenses can range from $10,500 to $48,000. When considering the financial aspect of this venture, it's essential to account for factors like permits and fees, utility connections, and the cost of materials, which can significantly impact the total expenditure.
