What does it cost?
No hidden costs. We can do a little better than “It depends.”
Most people that are seeking to build or renovate have hired contractors, or General Contractors, for a project or two at minimum, but some are pursuing help on their first project. If you haven’t hired contractors for a project in 10+ years, it may feel like you haven’t before when you hear the costs today.
One hard fact to face is that you can nearly spend an infinite amount of money on home construction. It’s not hyperbole, there has never been better access to a variety of materials, 0r inspiration photos. Like many other things in life, seeing pictures of people’s home projects on social media can be misleading, and downplay the work/investment it took to get to that after-photo. Construction can be costly, even with cost-effective selections. Let’s take a deeper dive into the typical costs of residential construction in West Michigan.
At Principle Homes, we likely aren’t going to be your choice if you are looking for the most cost-effective option. Our cost will be competitive if you are looking for the Professional option.
Here are some general costs we see on our projects in West Michigan, or projects we have estimated, after we tally up the scope of work people are looking for
New Construction.
A quality home is going to start in the $350 - $400+ / square foot vicinity, not including land.
Cost-per-square foot numbers aren’t great metrics for estimating costs, but they can get you in the vicinity for starters. Many factors impact cost: geography, timing, complexity of design, grade of finishes, speed of construction, and more.
It’s not difficult to spend more than $400 / sqft.
Renovation.
The below prices are based on our typical fixed-cost pricing structure. This isn’t necessarily typical for every company in renovation, and will likely be higher than a Cost-Plus / T&M cost-estimate. See our Fixed-Cost vs. Cost-Plus blog post for more info.
Standards.
Unfortunately, some standards aren’t standard. The costs in the above section are costs we see on our own projects, or ones we’ve estimated. While cost is affected by many things, those ranges can get you an idea of what to expect.
Significant scope changes can raise/lower each cost. For instance, direct replacement renovations are much more cost effective than full renovations. And building simple homes with simple finishes can be pretty cost-effective.
Some Advice: If you are comparing the same scope of work and services from professional companies: the costs from each are going to be similar. If somebody is way off, something is probably different about their quote’s scope or the services included.
Detailed scopes of work will give you a detailed idea of what you’re paying for… and what you aren’t. Services have associated costs, and if they’re not present on every quote you get, then the numbers may vary. Not every company may consider certain services as standard.
Some standards at Principle Homes
Complete pricing, design, and project development
Fixed-Cost pricing structures
Integrated, involved Project Management start to finish
Professional subcontractors (with licenses / insurance)
Expert design input and participation
Dust barriers and HEPA air scrubbers in the containment zone
Whole home post-construction clean
Ownership care recommendations and documentation
Follow-up visits for tune-ups at no cost
Just because we consider it standard, doesn’t mean it has to be included. Some people like to handle their own post-construction deep cleans, because it’s not clean unless they clean it. We get it, and we will accommodate.
Expensive vs. Costly
Just because something is costly, doesn’t mean it's necessarily expensive.
Some companies’ construction estimates can be difficult to decode and digest, there is often large amount of info to cover for a project. It’s easy for costs to add up fast. Once services are being performed on-site, it's easy to forget how many people made it possible for a service as simple as a wall getting built.
Not only supply-chains: lumber mills, distribution, lumber yard, delivery drivers, and more…
But also on-site work: it takes a considerable team to organize a project, and a considerable team to get people on-site, equipped, active… and working safely.
Part of mitigating risk on a project is safe practices and licensed, insured personnel. Injuries or under-insured labor can turn a costly project into an expensive one. Professional contractors will be licensed, insured, and cost more; unfortunately these qualifications aren’t standard in the industry.
What makes construction costly?
Professional Labor
Labor is becoming more specialized every day, and more scarce. As the trades have become more regulated and standards of construction have risen, labor has become more complicated. This sector has/had a reputation for being a catch-all for laborers, but it has long been becoming more polished, more professional, and safer. People aren’t ending up in the trades, they’re choosing it; they’re taking pride in their craft, and they expecting to be compensated as the professionals that they are.
Quality Materials
We are asking more of our building materials than ever before. Both in technology and maintenance-free capabilities. More processing and productions requires more people. Just like the trades, materials are becoming more specialized. Go down the rabbit hole of siding and your will keep yourself busy for some time.
You can still use simple materials, absolutely. But, many people start looking at low-maintenance options, and that’s where the price starts climbing.
Regulations
Minimum building code standards are rising. An effort to eliminate waste, conserve energy and resources, and raise safety of structures has resulted in the minimums being more costly than before. There are many failing, degrading homes around the country that people don’t want to invest money in to fixing, or aren’t worth fixing. Raising minimums is one way to try to fix this.
Professional Services
Another aspect of labor becoming more specialized, is the services provided by the companies. Project Management isn’t just a career in manufacturing or corporate offices, its on construction sites. Standards and expectations are rising for management of construction projects, rightly so! Communication, precision, and complex assemblies are difficult parts of an already complicated sector, costs come with that.
Professional General Contracting companies who deliver top quality services that people are looking for are likely going to cost more than the companies that are just providing on-site labor services.
Professional services are a key part of delivering top quality work on-time and on-budget, safely.
Professional Service Fees.
Most of the service-focused companies involved with your project will charge a fee based on the total cost of the project. Though lump-sum fees are used in some cases. Whether you are hiring a contractor or General Contractor will be a key differentiator in cost as well.
General Contractors have fees in their overall cost that are in addition to the costs for the suppliers and contractors they hire. These fees are the cost of hiring the General Contractor for their supplied services, management of your project, and the liability/warranty for the project that they carry. Errors, injuries, and other liabilities are the responsibility of the General Contractor.
Typical fees for professional services
These costs will depend on the pricing structure (fixed cost vs. cost-plus), project complexity, scale, and duration of the project.
These aren’t profit percentages, they’re fees. The business’s overhead costs will be included in these figures.
Principle Homes
We’re a General Contractor, and we can provide as much or as little services as your project requires. We start with Project Management, but can add Design, direct labor, and more.
Our fee structure is a fixed rate for your project’s demands, and typically falls in the 15% - 30% window for General Contracting on Fixed-Cost contracts. If you pick more expensive allowances: we don’t charge more money.
Part of our commitment to you and your project is figuring out as much as we can up front, so everyone knows where we are going, how we’re getting there, and where we will end up.
Building or renovating is a significant investment, it can be the largest investment a family will make, both in time and money. Make sure you have a team you trust to be a steward of your investment.