You’ve painstakingly picked out your paint color and chosen the perfect bathroom tile. Now it’s time to let your builder take over the details, right? Some production builders utilize a fixed price model after the estimating phase, but it’s not always the case. Building a home yourself or using an individual contractor could leave you on the hook for extra costs. After all, there are some things you just can’t plan. Whether it’s a weather delay or inaccurate plans, incidentals can really blow your budget. Knowing what areas to plan for and leaving a little padding in your new build budget can keep you on track.

Keep an eye out for these common new build budget busters and talk to your contractor or builder about the game plan.

Land costs

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Your land costs could affect your budget before you build. Image: Wisconsin Landscape Contractors Association

Some of the sneakiest budget busters can drain your budget before you even pour a foundation. Land development and improvement costs aren’t always factored in when estimating a build budget, so ask your builder about these costs:

  • Lot improvements. If you’re building on an unimproved lot (without sewer and electrical already stubbed), you’ll need to add improvement costs to your overall budget. Depending on how far you are from the closest sewer line (or if you’re going with a septic system), you might be looking at a few thousand dollars before your lot is buildable.
  • Soil conditions. The type of soil that fills your building lot dictates the weight of what can be built there. You (or your builder) will need to procure a soil report and your home will be structurally engineered for what your soil can bear. Ignore the report or skip it altogether and you could end up with pricey repairs or requiring further excavation before your home is ready.
  • Site plan changes. An architect creates a site plan for your home, but you can still change your mind. If you decide you’d like your home in a different spot, however, be prepared to take a chunk out of your budget. Even if you haven’t started building, the new plan will cost you. If building has already started, it’ll cost you even more.

City costs

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City impact fees give you access to public services. Image: Platinum Landscape and Pools

Wherever you build, the city, town, or county takes a cut. If you’re new to building, you might not have planned for budget busters that are paid to the city rather than your builder.

  • Impact fees. Impact fees are basically a tax paid to the city for the privilege of building there. Impact fees usually go toward things like parks, road maintenance, and other public services you’ll use. They can be anywhere from a couple thousand dollars to $10k+, so ask your builder about the fees and whether or not they’re included in the build price.
  • Permits. Every time you submit a permit to the county, you’ll pay a fee. You’ll definitely need a building permit, but you might also have to get permits throughout the process. Each county is different, so it pays to understand the permit process upfront or risk expensive fines.
  • Code infractions. Stick to the code! Each city has rules for home design and building and ignoring them could leave you with a fine and an expensive redo. Your designer and builder know the code, so don’t push them to create a home that doesn’t adhere.

Home costs

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Cosmetic touches make your house a home, so budget your new build accordingly. Image: DM Interiors

You’ve navigated the pre-build process and stayed on budget, but the build process can be just as unpredictable. Always clear your budget and estimate with your builder beforehand, but know that these costs can still drive up the final price tag.

  • Sealing. You love your new bathroom tile, so you want it to last. Unfortunately, the cost of sealing tile and flooring isn’t always included in the bid. Budget anywhere from $0.75 to $1.25 per square foot for all of your sealing (and labor).
  • Window treatments. Local looky-loos might want to peer in your windows, so don’t forget your window treatments. Whether you go with drapes, blinds, shutters or another treatment, covering all of your windows can be a pricey afterthought.
  • Cosmetic fixtures. Your bathroom is exactly how you’d dreamed it would be – except for the lack of mirrors and towel racks. Don’t forget to budget for all the little functional fixtures that make your home livable.
  • Landscaping. Landscaping isn’t always included in your builder estimate, so ask up front. Putting in sod, pouring asphalt, and planting trees can make up a significant cost at the tail-end of an already expensive build. (Luckily, you can do some of the work yourself to save money.)
  • Builder upgrades. Maybe you thought you could get away with starter-level appliances but changed your mind. Perhaps you made a last-minute choice to opt for the jetted tub instead of the standard shower. When you make upgrades during the build process, expect your final price to increase.

Budgeting your new build

Building a custom home can be confusing, but it doesn’t have to be a gamble. Whether you choose to use a builder or contract the home yourself, it’s up to you to manage the budget for your new build. Knowing the process inside and out helps you watch for budget busters that balloon your final price. As long as you keep some padding for issues, upgrades, and incidentals, you won’t be left with sticker shock on your move-in date.