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How Much Does It Cost To Build A Custom Home?

August 10, 20234 min read

Building a custom home is more than just a dream for many. It's an opportunity to create a space that perfectly reflects your tastes, needs, and lifestyle. However, one question inevitably pops up when considering this venture: how much does it actually cost to build a custom home? Let's dive deep into this topic.

1. Understanding Custom Home Costs: The Variables

A. Types of Builders

  • Fixed-Price Builders: Some builders will provide a solid number, a fixed cost for your home. This is the amount you'll pay, no matter what.

  • Cost Plus Builders: Sanctified Homes, for example, operates on this model. It’s believed to be the most transparent way to build a home. Here, you’ll see every invoice. After settling them, you are then charged a percentage above the given price to construct your home.

B. The Deceptive Nature of Allowances

Many builders provide allowances for various aspects of your home – flooring, appliances, cabinets, etc. The risk lies in these allowances being significantly lower than what you might actually want. For instance, a builder might allocate $3,000 for appliances when in reality, high-end brands like Wolf or Sub-Zero might cost up to $30,000. It’s crucial to understand and scrutinize these allowances to prevent unexpected costs later on.

2. Factors That Impact the Cost

A. Material Choices

The materials you select for your custom home are significant determinants of its overall cost. While the price of basic building materials like lumber is relatively standard across the board, the cost can vary greatly when it comes to finishes:

  • Appliances: Choices range from brands like LG or GE to high-end brands like Wolf, Sub-zero, or Thermador.

  • Flooring: Decide between options like carpet, LVP, and LVP tile or splurge on real hardwood floors and ceramic tiles.

B. Cost per Square Foot

Many potential homeowners look at the cost per square foot as a determining factor. However, this metric can be misleading. A large unfinished space may skew the price per square foot, making it seem more expensive than it truly is. On the contrary, finishing a basement might be more economical since the foundational structures are already in place.

3. Additional Factors to Consider

A. Location: 

The locale of your custom home is a paramount consideration in the cost calculation. Urban areas, with their proximity to amenities and services, can often have higher land prices than rural or suburban settings. Moreover, certain regions may have unique regulations, zoning requirements, or architectural standards that could affect construction costs. Researching and choosing a location wisely ensures you're prepared for the financial implications tied to a specific area.

B. Infrastructure: 

Beyond the home itself, the infrastructure it requires can significantly influence your budget. Needing to drill a well for water access or installing a septic system can add unforeseen costs. Driveways, especially long or intricately designed ones, can also be a sizable expense. It's essential to factor in these infrastructural needs early on, so you’re not caught off-guard by additional expenditures down the line.

C. Land Preparation:

Before the first brick is laid or the foundation poured, the land on which your dream home will sit might need extensive preparation. This could involve tree removal, grading to ensure proper drainage, or even dealing with rocky terrain which might need excavation. Such tasks, while vital to ensure a stable and lasting home, can add to the initial costs of the project. Assessing the lot thoroughly before purchase can provide a clearer picture of the prep work required and its potential costs.

Concluding Thoughts

The journey of building a custom home is as unique as the homeowners themselves. While general figures can provide an overview, the actual cost is influenced by a myriad of choices and external factors. For a comprehensive understanding and to truly gauge the cost of building your custom home, it's essential to sit down with a trusted builder, discuss your preferences, and get an accurate estimate.

For those interested in more insights, you can explore further resources and videos from Sanctified Homes and the Blessed to Build Foundation. Dive deep into topics like what constitutes a healthy home, tips for potential homeowners, and more.

In the end, remember to always raise your standards and work towards creating the home of your dreams.

If you want to learn more about Sanctified Homes & Construction, checkout our homepage at WisconsinHomeBuild.com, or book a call directly on my calendar here

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TJ Vitense

Founder of Sanctified Homes and Construction & the Blessed to Build Foundation, TJ believes in raising the industry standards. With his company Strategic Real Estate Experts, he helped hundreds of families buy and sell homes. And, now manages new home construction as one of Wisconsin's best home builders.

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Honesty is always the best policy, and this is the policy we swear by. We aim to be as transparent as possible with our clients when building their homes.

  • We have no hidden fees or surprises.

  • We disclose every invoice and bid because we have nothing to hide.

  • We are upfront about all costs, including the price or materials and labor costs, so you can trust every dollar of the process.


Our team has over 25 years of experience in construction and design, so we know how to make your dream home a reality.

  • Over 200 homes build with our combined expertise!

  • 25 years experience in Parade of Homes

  • Builder Of the Year with Madison Area Builders Association

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At Sanctified, we are committed to raising the standards in the industry. At our core, we value transparency, trust, & communication. Our mission is not to only give you a modern, efficient home, but a place to experience life with the ones you love the most.

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