The Complete Process Of Building A House

Let's begin with the big picture and then break it down into bite-size chunks. Whether you are looking to build your own custom home yourself or putting everything in the hands of professionals who specialize in new home construction, understanding how everything works is critical.

You have compared building vs. buying an existing house and decided to build, so that’s one giant step already complete. However, the building process will provide many more decisions as you get deeper into it. 

Not all projects are the same. For example, using a builder will be very different than doing it on your own. A builder will take care of the process from foundation to final inspection, knowing the proper steps and people to employ along the way. If you do it yourself, all of that responsibility is yours alone. 

Things like establishing a good house plan (one-story home or two-story, for example), finding the right builder, and outlining the process from start to finish will go a long way toward a smooth experience. Smooth is a relative term, though, as things often don't go exactly as planned. Having confidence in your knowledge of the process is the best way to make sure you can power through when the going gets tough.

The first step of most successful journeys begins with a plan and a budget. New construction can be costly and time-consuming, so it is crucial to understand what you can afford and how long it can take to still be happy. This initial plan will also allow you to have something to reference when things go off track, which they most assuredly will at some point. Speaking of that, make sure you pad that budget, as unexpected costs are par for the course. 

The planning process is an excellent time to start thinking about who is going on this journey with you. A general contractor and real estate agent are two good people to begin with. Of course, you can save money by doing the general contracting yourself, but that means putting in a lot of hours into hiring tradespeople, paying invoices, getting local government approvals, and managing the budget and timeline, just to name a few of the many tasks.

Once you and your team have a budget and timeline in mind, the design phase begins. Your architect will tailor the design to your specific tastes and daily living needs. 

Once the design is complete and you have a better idea of your construction costs, it will be time to investigate construction loans. Be sure to shop around, as getting a few different quotes to compare is always an excellent way to save money. Make sure you ask about all the various loan types available as well, as you may have more options than you think. There are even ways to get construction loans with bad credit. Trust the experts, as this isn't like getting a traditional mortgage for an existing home. 

Next, it’s all about location. Finding the right plot of land to build on is not an easy task. Your real estate agent should take the lead on this, but ultimately it will be for you to decide if the location and nature of the land are suitable.

Once you have found the spot and prepared it for building, the construction process begins. This will include laying the foundation, framing the house, and adding exterior walls at the start.

With the bare bones of the outside constructed, plumbing, electrical, HVAC, insulation, interior walls, and trim will come next. 

Then it’s back to the outside to construct the driveway and other exterior features before heading back into the house to complete things like flooring, countertops, mechanical finishes, and other final touches. 

Once all that work is done, you walk through the home one last time before living in it to ensure everything meets your expectations. Well, not just your expectations. A final inspection will need to be done to make sure it meets the expectations of your local municipality as well. 

So, now that you have a high-level overview of the process; let’s go step by step and dig deeper into the specifics of your dream home project. 

Assemble Your Team

Even if you plan to build the house yourself, you will never do it completely alone. Your family is the first “team” to consider, as their needs will need to be addressed for a happy outcome. 

This will require some compromise, so be ready for that. Doing as much as you can yourself is admirable for sure, but the reality is you will never have complete control of building your own house. It takes a team.

Suppose you want to be your own general contractor. In that case, you will need to find the right architect, lender (for a construction loan), real estate agent, builder, general contractor, plumber, electrician, and foundation expert, just to name a few. 

In addition, if you are the general contractor, you will be liable if there’s a problem during construction or inspections. If this seems daunting, consider hiring the contractor job so that the right person can run the whole operation for you. It will cost anywhere between 5 and 15 percent of the total project cost, but it may be worth it in the end.

Architecture And Design

An experienced architect can help with home style, exterior design, floor plans, and more. Be sure to discuss the various types of traditional homes you can build like ranches, colonials, bi-levels, mid-century moderns, and more.

In addition, think about how much square footage you need. Are you building a home for two people who love to travel? A tiny home, even a container home, might work. As long as the floor plan is sound and each square foot is well thought out, you may not need as much space as you think. 

In contrast, if you are a “homebody” that likes to spend a lot of time relaxing in your abode, or if you work from home and need a large home office, building a tiny home probably isn't the best way to go. 

Keep in mind that custom homes will be more expensive than tract homes - which are houses built on a large parcel bought by a developer and then split into smaller lots.  Why? Custom homes usually require specific building techniques and unique additions that tract homes don't.  Both types can work well as single-family homes, though, depending on your needs.  

Ranches will be more expensive than two-story homes. Why? Ranches require more foundation work since all the square footage is on one level. Talk to your team about pros and cons for each home type, with an eye on cost, before you build. Finding the right balance between what you want and what you can afford is the ultimate goal of you and your architect. 

Construction Costs

When you get into building costs, it usually comes down to cost per square foot. This number is calculated by adding up all the cost of the building materials and combining that with the labor required to make them into a home. Keep in mind that you will also need to calculate the cost of the land to build on. These calculations should be done in tandem because the lot of land you choose matters when it comes to the size and price of the home build. 

Keeping costs down can be done by material choices and doing some of the labor yourself. Choosing inexpensive materials like concrete instead of wood when lumber prices are high is one example of potential savings. For labor cost savings, it’s not all or nothing. Maybe you aren't comfortable working on electrical but are a master plumber. Or perhaps you are confident you can put in a driveway but not put on a roof. 

Building your own home by yourself may seem rewarding, and it is, but don't stretch beyond your confidence and capabilities. Pick and choose what to outsource based on your expertise and, of course, your budget.

Construction Loan

Once you know your land and building costs, it’s time to look into construction loans. These are a little different from a traditional mortgage used to buy an existing house, but the two loans work together. 

A construction loan is a short-term fixed-rate mortgage loan that covers the costs of building your new home during construction. Once the home is done, you will need to apply for a conventional mortgage and pay it off like you would when buying an existing house. 

Unlike a traditional loan, you can pay only the interest and not the principal during house construction. This frees up funds for other things, which is critical when undertaking a financial task as big as the construction of a new home. 

Land For A Building Site

You’ve probably heard a real estate agent or two say “location is everything” before, and when it comes to your dream home, this isn’t something to ignore. If you’re buying a tract home, the developer already bought and paid for the land. For a custom home, you are going to need to find and buy your own land. 

Being in the neighborhood, city, or state that’s right for you is essential, but don't overlook the physical properties of the land as well. For example, if the land is in a valley, you will need to ensure proper drainage, so water doesn't pool near the house and seep into the basement. If you are hoping to have a walkabout basement, building on a hill is a better approach. 

Work with your architect and builder to select the right piece of land that will fit the house you are planning to build. Once you have the building site chosen and purchased, you must prepare it before constructing the home. 

Getting the land ready will involve removing any debris, trees, bushes, rocks, and other vegetation on the part of the land where the home will be built. This includes removing stumps and roots to prevent more vegetation from growing in the future. Why? Vegetation can lead to wood rot, water seepage, and even mold.

Construction Process

At this point, you have selected your custom home builder or tract home builder that will guide you through the construction process. They can guide you through the process step by step, but knowing what to expect along the way will help you from getting blindsided by news you aren't prepared for. Here is an in-depth look at each step along the way.

The contractor (or you if you are doing it yourself) must communicate with the local municipality before any building begins to share your plans and pull the necessary permits. There are many types of permits you might need depending on what you want to do, but it all starts with a building permit.

Beyond that, the most common permits relate to plumbing, HVAC, electrical, and sometimes grading. 

If you think this is a step you can get around or skip, think again. Starting the build without the necessary permits means that when the authorities find out, and they usually do, you will be slapped with heavy fines and have your project delayed indefinitely.

A good foundation is the key to a long-lasting structure and if you’re hoping to build your dream home, don't you want it to last? You can choose between several foundations, including a slab, basement, or crawl space, but basements are the most common, so we will stick to them here.

First, a large hole is dug for the basement, and the footings, usually made from brick or concrete, are put in. Next, foundation walls are built (brick) or poured (concrete), and once they are dry, a waterproof membrane is applied. 

There will be a bit of waiting after this step because concrete needs to go through a curing process. It could take a month or two on the longer end (or as little as a week on the shorter one), but it must be fully cured before you move on to framing the house.

Framing is when you will start to get excited as your house begins to come into view. The walls, flooring, ceiling, and roof trusses (the foundation for roof systems) all will be erected, and a skeleton frame of your eventual home will come into shape.

Plywood is attached to the exterior wall frames, and the roof and exterior doors are completed. Then everything is covered with a protective barrier known as a house wrap. This keeps out water but allows water vapor to escape. This is also the time to install windows and, once complete, really starts to look like the home you’ve been envisioning from the start.

While the window and doors are put in, the rough plumbing can begin as well. This entails running water pipes to the kitchen, bathrooms, laundry room, and any other rooms that will need running water. Sewage pipes will be installed running from the bathrooms to the city sewer or septic system.

This is one of the tasks where it might be a good idea to have a professional do the work instead of the DIY approach, as an inspection of the rough plumbing will occur once it's completed.  As you may have guessed, a licensed plumber is usually more likely to pass the inspection than an amateur plumber.

After the plumbing comes the electrical work. Electrical wiring is run from the electrical panel through the walls and ceilings to everything that needs power. This includes power outlets, smoke detectors, garbage disposals, fans, ceiling lights, and everything else you can think of in a home that needs electricity. 

Some of the more significant items that will need power are related to the HVAC system. The furnace and air conditioner require a lot of “juice,” so to speak, and will take up a large portion of the house’s electrical capacity. 

Regarding HVAC, keep energy costs in mind when selecting these items, as some are more energy-efficient than others. This will help with the monthly bills as well.  Heating costs can vary significantly by furnace type, for example. 

Much like the plumbing, this is something to consider outsourcing due to the potential for a serious injury and, again, passing inspection.

Insulation is a critical part of making sure you and your family are comfortable in your newly built home. Well-installed insulation is one of the most vital steps in building your new home that ensures you’ll be able to keep in the heat in the winter and the cool air in the summer.

The options are plentiful for insulation and include fiberglass, spray foam, concrete, cellulose, and foam board. When choosing insulation, pay attention to how well each option stops the transfer of heat. You can tell this by looking up the materials’ R-Value. The higher the R-Value, the more comfortable and energy-efficient your home will be.

Once the insulation is selected and installed, it’s time to get the interior walls up. This usually entails hanging drywall between the frames of the walls and then putting on the initial coat of paint. 

During this process, the home’s inside will start to take shape, with any texturing you have decided to add to the walls being done. Once the inside is complete, that same process of texturing and finishing is done to the exterior walls.

Next, things like window sills, cabinets, bathroom vanities, fireplace mantles, and interior doors are added. A final coat of paint is the finishing touch to this step in the home building process. 

As you go through the home and add the internal trim, the vision you carefully planned for each square foot of the house becomes a physical reality.

With the inside nearing completion, your attention should move to the outside again. Installation of driveways and other exterior finishes is done, always with an eye toward proper drainage and aesthetic value. 

This process is done near the end because some of the large and heavy equipment used in the earlier stages of new construction can damage driveways, patios, and other external features.

Hardwood floors, carpet, or other forms of flooring are installed next along with countertops. 

Hardwood flooring is installed after so much interior work has already been done to ensure it doesn’t get damaged from installing other things and painting.

Next, the HVAC and electrical groundwork that has already been laid gets its finishing touches, including the installation of electrical outlets, light fixtures, and heat register covers, just to name a few. 

With the addition of these mechanical finishes, the home is nearly complete. Only a few final touches remain.

On the inside, decorative trim, interior finishes, shower doors, and other items done at the very end make the project complete. On the outside, grass, shrubs, and other final landscaping provide that final curb appeal that makes your new construction house a home.

This step is one of the most exciting parts of new construction, as you see how the blueprints have formed into a real, tangible home. The journey to get to this point might have been rocky at times, but a huge sigh of relief for a completed job usually accompanies the final walkthrough. 

This step serves two main functions. First, it is a chance for you to make sure the floor plan you envisioned at the start has come to fruition, with each square foot done as you intended. Second, it’s a chance for your builder to ensure everything is in tip-top shape for inspection.

The final inspection, done by a representative from the building department in your local government, makes sure building codes have been followed and everything you have done is in line with local building rules and regulations. Once the inspector gives you the green light, you are ready to move into your new home!