For buyers in Michigan, building a house is certainly one way to combat the low inventory of available homes resulting from the hot seller’s market we’ve seen over the last two years.
But according to Bethany Brokaw — a real estate agent who has been selling homes in Genesee County for over a decade — the average cost to build a house in Michigan “would be deemed quite expensive right now, especially compared to three years ago.”
Brokaw says that, on the low end, buyers can expect to pay $150 per square foot to build a house, “and I’m talking no basement, very small lot, and builder-grade finishes,” she explains. “And your higher end can be anywhere between $300 to $700 per square foot, depending on your location, if you have a water view, how large your lot is, and which finishes you choose.”
On average, though, to build a home in Michigan with desirable finishes like granite countertops, hardwood floors, and other basic upgrades, “buyers are definitely looking at around $250 per square foot,” says Brokaw.
To build a 1,500 square foot home, this clocks out at a cost of $375,000. Meanwhile, the median price per square foot of existing homes in Genesee County is just $135 per square foot — or $202,500 for 1,500 square feet.
When it comes to purchasing a home, there are plenty of reasons why buyers might have their eye on a new construction property rather than an existing house. There’s an undeniable appeal to being the first one to live in a brand new home, and if you’re buying early enough to be involved in the building process, you can often make decisions about paint colors and upgrading materials to customize your home before you even move in.
Of course, the cost of buying real estate is rarely so cut and dried. It may well be cheaper to buy a house than to build one, but it depends on everything from location to your personal preferences for fit and finish.
Here is an at-a-glance look at the average costs of each phase of building in Michigan, but we will break it all down next:
|Building Phase||Average cost (2022)|
|Framing||$14,000 – $32,000|
|Finishes and Fixtures||$42,000 – $175,000|
Costs to build a home in Michigan in 2022 ($375,000)
No matter which state you’re in, the steps involved in building a house will vary depending on whether you’re buying a tract home — which is when a builder has bought a large tract of land to divide into lots and build out several homes — or if you’re building a custom home.
Keep in mind that the price ranges we’re providing are a general estimate. Your agent and, eventually, your builder can give you much more specific information on pricing!
Buying a plot of land ($5,300 per acre)
According to an April 2022 report by the National Association of Realtors, land sales rose 6% in 2021. Land sales for residential use were also up, accounting for 4% of all residential real estate sales in 2021.
The USDA’s land values report for 2021 — which evaluates farmland real estate values — indicates that Michigan’s average value per acre was $5,300 in 2021, which is a 7.1% increase over 2020’s land value of $4,950 per acre.
Now, if you’re looking to build a single family home in the suburbs, the price of farmland probably doesn’t seem relevant. But these numbers do provide a baseline for managing expectations, and working with an experienced real estate agent will help you fill in more specific pricing gaps based on your specific location and lot size needs.
Foundation ($4,000 – $13,500)
Foundation costs will vary depending on whether you’re pouring a slab or digging a basement, but a typical price range is between $4,000 and $13,500.
Framing ($14,000 – $32,000)
Framing is when the sticks go up and a structure actually starts to take shape. Expect to pay between $14,000 and $32,000 for this phase of building a house in Michigan. Framing costs tend to vary due to both the size of the home and the complexity of its design — a one-story home with 2,000 square feet of living space will generally be less expensive to frame than a two-story home with the same square footage.
Roof ($5,500 – $12,000)
Roofing doesn’t come cheap — whether you’re putting one on a new house or replacing the roof on an existing home. The costs of a new roof typically range from $5,500 to $12,000. Asphalt shingles are the most affordable roofing option, at around $1 to $3 per square foot, with tile roofing being more expensive, costing around $8 to $25 per square foot.
Siding ($5,000 – $14,000)
Siding is another big variable: Are we talking vinyl, wood, brick, concrete, stone, stucco, or something else entirely? Siding costs range between $5,000 and $14,000, with vinyl or engineered wood siding typically costing between $3 and $12 per square foot.
You guessed it — appliance pricing also varies widely. Depending on brand, functionality, finish, and so on, you’ll spend an average of $10,875 if the home does not come with any, but you can definitely drop up to $24,400 or more on high-end appliances.
HVAC system ($12,500)
Plumbing system ($2,000 – $5,000)
Plumbing can cost anywhere from $2,000 to $5,000 on average — not including fixtures like sinks and toilets.
Electrical system ($500 – $2,300)
The cost to wire a house is, on average, between $500 and $2,300.
Building permits (Variable)
Permits vary by state, city, and county, but they typically range from a few hundred dollars to a few thousand. In Michigan, permit costs to build single-family homes are based on the project’s calculated “total cost of construction.”
Finishes and fixtures ($42,000 – $175,000)
Finishes and fixtures comprise everything from countertops to sinks, and lighting to flooring. Needless to say, pricing varies widely and depends heavily on your preferences.
Additional costs of building a custom home in Michigan
As we mentioned, building a custom home usually comes with additional costs. Again, your agent can help you determine more accurate costs — these are average figures provided to give you an idea.
Hiring an architect ($18,750 – $75,000)
Architect fees fall between 5% and 20% of the total project cost, according to HomeAdvisor. So, for the 1,500 square-foot home with a build cost of $375,000 we were using as an example earlier, that could mean anywhere from $18,750 to $75,000.
Land survey ($375 – $475)
Excavation and grading ($20,000 – $50,000)
If you’re buying a tract home, the land price will be rolled into the overall price to build a home. If you’re buying a lot on your own and then building a custom home, Brokaw says you can expect to pay between $20,000 and $50,000 to clear the land, run utilities, and put in a driveway.
More affordable options for building a home in Michigan
While going with a bare-bones building strategy can get you into a new construction home for less, cheaper isn’t always better. Shoddy build quality will inevitably lead to problems down the road — anything from a leaky roof to poor sound insulation can be a frustrating discovery when you’ve only been in your new home for a few months — and there’s value in creating a home you genuinely want, not just one you’re settling for.
Alternative home building options can give you more for your money and offer valuable flexibility during the construction process.
Tiny homes ($30,000 – $60,000)
A tiny house is usually 600 square feet or less in size. They’re not ideal for large families, but building a tiny house can be faster and more affordable than a conventional home if a smaller space fits with your lifestyle. On average, tiny homes cost between $30,000 and $60,000 to build.
In Genesee County, Brokaw says tiny homes aren’t especially popular, but they’re increasingly on people’s radar.
“We have a national builder who just came into this area and they would have, by far, the lowest cost houses,” says Brokaw. “But every single one of their houses have the exact same finishes inside — you can’t even pick your paint color, even if you’re willing to pay extra. Their prices are roughly $140 per square foot.”
Modular and prefabricated homes ($180,000 – $360,000)
In Brokaw’s market, modular homes are not common — largely because deed restrictions and HOA regulations in the area call for site-built homes. That said, in general, modular homebuilding tends to cost between $180,000 and $360,000.
The timeframe you were quoted will probably not stick, and you need to be prepared that your quoted price point could also change if the builder runs into problems, or if you decide you want to change or upgrade something along the way.
- Bethany Brokaw Real Estate AgentCloseBethany Brokaw Real Estate Agent at The Brokaw Group Currently accepting new clients
- Years of Experience 12
- Transactions 652
- Average Price Point $152k
- Single Family Homes 608
It’s pricey, but it’s worth it to build a home in Michigan
Brokaw warns that between labor shortages and supply chain delays, building a new home in Genesee County right now can take seven to nine months for a tract home, or nine months up to two years for a custom-built home.
However, she believes it’s still worth the time and money if you’re interested in building a new home.
“It’s still a great thing for people to do. There’s peace of mind in knowing that every single thing in the house is new — it’s a wonderful thing,” Brokaw says. “It’s just something you need to be prepared for and think through, especially if you’re doing a custom product.”
Brokaw encourages buyers to work closely with an agent who has experience with new construction homes and the homebuilding process
“Ask how many new construction transactions they have; ask if they have personal experience with new construction,” urges Brokaw. “Ask if they’re familiar with the builders in the area and the different neighborhoods — different builders have different levels of quality.”
Finally, Brokaw wants buyers to remember that a project like this requires patience, understanding, and flexibility — both with price and timing.
“The timeframe you were quoted will probably not stick,” she cautions, “and you need to be prepared that your quoted price point could also change if the builder runs into problems, or if you decide you want to change or upgrade something along the way.”
In short? No matter where you’re building, be patient, be realistic, and be sure to work with trusted professionals. Good luck!
Header Image Source: (Shopify Partners / Burst)
- "How Much Does A Foundation Or Basement Cost?," HomeAdvisor (August 2022)
- "2020 Land Market Survey," National Association of Realtors® (April 2022)
- "Land Values 2021 Summary," United States Department of Agriculture (August 2021)
- "PRICING A NEW ROOF IN WEST MICHIGAN – WHAT SHOULD YOU EXPECT?," Werner Roofing & Exteriors (May 2013)
- "Tiny homes can mean big costs, especially depending on where you live," CNBC (August 2021)