Calculating House Building Costs

Purchasing land on which to build a dream home offers an exciting opportunity to tailor a property. However, it is important to fully understand the cost of building a house, and the key considerations are:

• The cost of building
• Construction work expenses
• Building costs per m2
• Strategies to reduce costs

House Construction Expenses:

In 2024, the cost of building a house from scratch in London is £3,500 per square meter of floor area. Although this is 1.5 times higher than in other areas of the UK, self-built properties generally cost between £1,750 and £2,750 per square meter.

Building Your Own vs. Buying:

Building a house can be more cost-effective than buying and renovating an existing property as it enables the individual to customize a property. In addition, the cost of construction can be managed through the use of budget-conscious materials and energy-efficient features.

Cost Breakdown for Building from Scratch:

While the average cost to build a house is approximately £160 per square foot, extra expenses include the purchase of land, and fees for planning application and building regulations.

Factors Influencing the Total Build Cost:

Several considerations significantly determine the overall cost of building:

• Land: Costs vary based on the property’s location, size and standard.
• Building materials: Whether metal cladded or timber framed, the choice of material is a key influence on cost.
• Architectural services: An architectural service offers support when planning, seeking permission, and choosing the most budget-appropriate materials.
• Building contractors: Their experience and level of skill also influences costs.

Construction Work Costs:

Although the construction comprises a large portion of the budget, additional features such as loft conversions or luxury kitchen extensions add expenses.

Design Fees:

AThe design of a house closely correlates with its build costs, meaning that more exclusive, detailed developments incur greater expense. In addition, employing interior designers mean factoring in fees that range from 7% to 15% of the overall budget.

Demolition Expenses:

The preparation of a site, which includes any demolition and the removal of waste, usually varies from £5,000 to £10,000. 

Foundation, Drainage, and Project Management:

Factors such as building size, soil conditions, and foundation type affect the cost of the foundations, while the drainage costs between £500 and £1,000, and project management fees around 5% of the overall expense.

Utilities and Roofing:

For utilities, electrical works costs range from £3,000 to £5,000, while for a 2-4 bedroom house plumbing can vary from £13,000 to £17,000.  Furthermore, roofing costs between £5,000 and £6,000.

Additional Expenses:

Building from scratch can incur additional fees, which include planning permissions (£462), building regulation applications and inspections (£1,000), site surveys (up to £500), and structural engineering (up to £500).  Furthermore, for properties exceeding £125,000 stamp duty land tax needs to be considered.

House Building Costs per m2:

To build a standard home in the UK, the average building cost is approximately £2,500 per m2.  This cost can escalate to £3,000 per m2 for properties with a higher specification.

Managing Construction Costs:

Strategies can be applied to reduce costs, such as purchasing a more reasonable site, independently managing the design of the property, undertaking some of the work yourself, and overseeing the project which avoids the need for a project manager.

Conclusion:

When considering to build a house from scratch, a number of variables need to be  evaluated in terms of cost. Such expenses can vary depending on the selection of building materials, and the expertise amongst the construction professionals. This means it is important to consult with building specialists to gather realistic estimates and ensure financial preparedness before starting such a project.