Budgeting for a New Home: How Much to Build a House on My Land?

If you’ve ever dreamed of going on adventures in the wilderness or living a life outside of the hustle and bustle of suburban or city life, off-the-grid living may be something you’ve considered. If so, you’re in good company — more than 250,000 people in the United States have ditched the standard “American dream” to be self-sufficient, connect with nature, and reduce their carbon footprints.

Even if you don’t want to live off-grid and your goal is to build a house on a plot of land you’ve inherited, you probably wondered: “how much to build a house on my land?” It depends on what part of the country your land is in and the condition of the property.

So, let’s start crunching the numbers!

Preparing your land

If you’ve inherited your little piece of America, you don’t have to worry about buying a vacant lot; although if you want to purchase land, the average cost for one acre of land could cost $4,100 as of 2019. The actual price will depend heavily on the region where you want to buy and the purpose of the land.

Land survey

Once you have the plot of land, you’re going to need to have it surveyed. A land survey will identify the boundaries of your property, and it’ll cost between $500 to $1,000. Of course, that price tag depends on the property size.

Clearing the land

After the land has been surveyed, it is going to need to be cleared. Clearing the land means debris, rocks, and vegetation will be removed from the area. The property will then be leveled or regraded so that it will be ready for construction.

The cost to clear your land is going to depend on the size of the lot, what kind of machinery is needed, how much work needs to be done, and labor costs. The price of clearing a single acre of land can range from $200 to $6,875. You might not need more than one acre cleared for the house itself, but don’t forget about access! You’ll need a road or driveway cleared, too, to get to and from your house.

Pouring the foundation

Although it may not feel like the ground is moving under our feet, the earth is always settling and shifting — that is why you need to pour a foundation when you want to build a house. It will protect the structure from damage or cracking due to the shifting ground.

Pouring a concrete foundation could cost between $4,000 and $28,000, or $4 to $7 per square foot. Keep in mind that there are factors that go into the cost of a foundation. These factors are:

• Type: Slab foundations are the most cost-effective foundations and can cost up to $21,000, whereas basement foundations will cost upwards of $175,000!
• Soil test: A soil test will cost between $10 to $100 per test. The test shows your contractor the soil composition, so they can choose the appropriate materials and techniques to use.
• Depth: If you live in a cold climate, have soil with poor drainage, or are building on a hillside, the foundation will need to be deeper to ensure adequate support for the home. This, unfortunately, can increase the foundation cost by as much as 75%.
• Building codes: Ask your contractor about local building codes because the rules may add expenses to your project.

Hookups for your land

Before you can start building on your property, you will have to get it ready for utility hookups. These hookups include water and waste disposal, energy, and communications.

Water and waste disposal

Do you think about where your water goes when you wash your dishes or flush the toilet? No? Don’t worry — not many people do. But, if you’re building a new house on a vacant piece of land, you’ll need to consider it.

There are two options available: sewer hookup, or installing a septic tank and well. Deciding which system you’d like to use is dependent on where you’re building; you may not have a choice. If you’re in the middle of nowhere, a septic system with a well will most likely be your only option.

Let’s look at the pros, cons, and cost for both options so you can decide which is best for your situation.

Sewer system

A sewer system is a shared system for treating wastewater. These systems are owned and maintained by the local municipality, and the waste is sent to a central treatment plant.

If you connect to the city’s sewer system, you’re most likely going to be connected to the city water supply, which will be an additional monthly cost.

The benefits of a sewer system

One of the most significant benefits of hooking up to a sewer system is that you don’t have to worry about maintenance because the city takes care of any problems that may arise. However, this rarely happens because the sewers are designed to handle a lot of wastewater, and they aren’t likely to flood out in the case of heavy rain.

The downside of a sewer system

The only downside of connecting to a sewer system is the additional monthly expense that you’ll need to include in your budget. Also, you may have a higher bill if your household uses a lot of water.

The cost to connect to a sewer system

Connecting your home to a sewage system isn’t going to be cheap. The cost to connect your home to the city’s system can range from $5,000 to more than $20,000!

The installation cost includes:

• Cost per foot for sewer line: On average, the cost to install a sewer line is measured by linear foot, ranging from $50 to $250 per foot. Installing new pipes will cost somewhere between $3 to $20 per foot, with an additional charge for labor. Labor can run between $30 to $247 per foot.
• Trenching costs: The cost for trenching (when pipes are installed underground for drainage) will depend on the length and depth needed to dig the trench. The price to do this is $800 per linear foot on average.
• Backflow prevention: A backflow preventer is necessary to keep the wastewater flowing into the sewer system and not back into your home. The cost for this will range from $125 to $900 per linear foot. Don’t forget the cost of labor, which ranges between $25 to $250. 
• Sewer cleanout installation: A sewer cleanout is an access point for plumbers when they need to remove any clogs that may be in the line. The price to have one of these installed is going to be around $2,000, including materials, equipment, and labor.

If you connect to the sewer system, you’ll have to pay a monthly bill for usage. The monthly cost will vary from town to town, so you’ll want to check with your local municipality to work it into your budget.

Septic and well

Unlike a sewer system, you own and are responsible for your septic system, which consists of a septic tank and a leach field.

Waste will enter the septic tank that runs from the house to the tank. Then, the waste is separated from the water, allowing solids to sink to the bottom and clean water to rise to the top. The freshwater then goes to the leach field where any remaining solids are removed, and the water seeps back into the ground.

To get water to your house, you’re going to need a well drilled to about 150 feet or deeper.

The benefits of septic and well

Unlike sewer systems, you aren’t going to have an extra monthly bill. Some say that having a septic tank is eco-friendly because they don’t contribute to groundwater contamination, as there aren’t any leaky or aging sewer lines to worry about. On top of that, if there are any problems with the system, only one area (your property) will be affected, unlike the amount of damage a faulty sewer system could cause.

With a well, you’ll have a source of fresh water that you never have to pay for. Your water supply isn’t going to be controlled by the municipality, and it can be more reliable than city water.

The downside of septic and well

Unfortunately, the downside of a septic system is that it will require much more maintenance because you’ll need to have the solids pumped to prevent plumbing blockages or overflow. If the system fails, you could experience septic overflow, which leads to a massive, stinky mess that you’ll have to have professionals come out and clean up.

The downside of having a well is that it will require electricity to run (we’ll go more into electricity installation shortly). If there is a power outage, you aren’t going to have any water. Also, since your water comes straight out of the ground, there isn’t going to be any chlorine in it to kill off any bacteria that may be swimming about. With no chlorine, your water isn’t going to have any fluoride in it, which could be a problem for your dental health.

Installation costs for septic and well

Installing a septic tank depends on a variety of things, such as the system’s size, the location, the type of tank and pipes needed, and the terrain. A small septic system can cost between $3,000 and $5,000, whereas an extensive network can range between $5,000 and $10,000.

Digging a well can cost between $1,500 and $12,000, but the average cost is around $5,500. 

Energy

Unless you plan on living a truly off-grid life and not relying on power at all, you’re going to need to budget the cost of installing an energy source. The most common options are connecting to a power grid (electric lines) or running a gas line — both of which require a licensed contractor to install.

Connecting to a power grid

In most situations, you’ll be able to get energy by connecting to a power grid. With that said, it’s not going to be easy, nor will it be cheap.

The first step to connecting to a power grid is to call the local power company. The power company will walk you through the requirements to determine the cost of service and the type of service you’ll need.

In most cases, the power company will charge a flat fee to run wires from your home to the nearest electric pole, and then they will charge you for every 100 feet. The cost of a new overhead connection service can range from $799 to $1,560. For an underground new connection service, it can range from $900 to $2,700.

The extra charge can range from $5 to $15 per 100 feet. Just be aware that this cost can add up quickly, especially if your house will be far away from an electric pole.

Running a gas line

If you prefer not to connect to a power grid, you can use either propane or natural gas. This option is much cheaper to install, as it can cost anywhere between $120 and $2,500, or $20 per linear foot for a simple installation.

Keep in mind; if you choose to use gas or propane for your energy needs, you are going to factor in the gas company you are using, how far your home will be from the mainline, local building codes, and whether there’s a clear path from the mainline to the house.

You’ll also have to decide if you want to purchase a tank (a 1,000-gallon tank can cost between $800 and $3,000) or lease a tank (depending on the company, it could cost as much as $150 per year to rent a tank).

The contractor

Regardless of which energy source you choose, the company you go with will send out a licensed technician to do the installations and connections. However, we recommend that you ask the energy provider a few questions before choosing which energy source you’d like to use.

Questions you should ask:

1. What services do you provide, and how does it compare to what I need?
2. What do I need to have before beginning the installation process?
3. Where will the connection be? Overhead or underground?
4. What is included in the cost to hook up to your energy supply?

Communications

Ninety-six percent of Americans own a mobile device, whether a smartphone or an average cell phone. The top cell phone companies are always expanding their service areas, which is great news for rural America. However, unless you want to spring for an unlimited data plan, you’re probably going to want to connect to the internet via an internet provider.

There are a few internet options available for rural areas, and their installation costs will vary by provider. Some options aren’t even a possibility simply because there isn’t enough demand for it.

Let’s look at the three most common connection types for folks in rural America.

Cable internet

Xfinity is the most far-reaching cable internet provider, as it serves over 111 million customers across 40 states. The pricing plans for Xfinity internet ranges from $29.99 to $69.99 per month. 

The downsides of using cable internet are that it isn’t available in all areas, and the signal gets worse the further out you are from the provider’s service source.

DSL internet

DSL (digital subscriber line) is a type of internet delivered through a traditional telephone landline, which is more common in rural areas. EarthLink and AT&T are two of the most popular DSL providers, as they serve (respectively) 165 million and 122 million customers across the country.

EarthLink plans range from $14.95 to $99.95 per month, and AT&T plans range from $49.99 to $59.99 per month.

Satellite internet

Viasat and HughesNet are the only satellite internet providers that are available to residents in rural areas. These companies are keeping up with new satellite technologies, and that caused other satellite providers to be discontinued or redirect their services through these two companies.

Viasat plans are available nationwide and range from $30 to $150 per month, and HughesNet plans range from $59.99 to $149.99 per month. HughesNet plans are also available nationwide.

Since you are building a brand new house, a licensed technician from whatever provider you choose will come out to your home and hook everything up. The installation fee will vary depending on your location and what internet provider you want, but on average, you’ll only pay a one-time fee that’s about $100.

Common types of rural or off-the-grid homes

There are many different types of homes that you could build on your plot of land. Here’s a quick rundown of the cost of making these homes so you can get a better idea of your options.

Prefab home

A prefabricated “prefab” home is a great way to get an energy-efficient home that’s pretty affordable and easy to customize. The total cost of these homes will depend on the size, location, and amenities you’d like to have. On average, these prefabs will cost between $180 to $220 per square foot.

These homes can be placed on a slab foundation or can be placed on a basement foundation — it’s your choice, and it will be at your own expense. The cost of these homes usually includes blueprints, structural engineering, building permit, roofing, windows, light fixtures, and more.

They do not include soil testing, land survey, utility hookups, driveways, and landscaping. These additional expenses will have to be factored in when deciding if going prefab is right for you.

Cabin

Cabins and log cabins are usually the type of dwellings you’d find tucked in some quiet corner of the world. You can find log cabin kits that have everything you need to build your home. Using these kits, you could make yourself a quaint 192-square-foot, single-room cabin for $24,500. You can build a 2,000-square-foot cottage for $50,765. You can even build a luxurious 3,380-square-foot cabin for $275,455.

Each kit will have different things included and different options available, which will affect the overall price. But, since these are kits, you will have to build or hire a contractor to make it for you. Framing and roofing materials will also be an out-of-pocket expense that will vary depending on the kit’s blueprints.

Shipping container

Shipping containers are becoming a popular type of home because they are very durable, eco-friendly, and can withstand anything that a traditional home cannot (fires, hail, heavy snow, and so on).

If you’d like to have a shipping container home, there are many different styles available, which will affect the price. However, the average shipping container is going to cost between $2,000 to $5,000 per box. Most folks use four to six containers for their homes, but you can go as big or as small as you’d like.

You can build and design these homes yourself, or you could hire a professional who has a selection of floor plans to choose from. You can even find companies that make prefabricated shipping container homes built offsite and can be transported to your land.

If you go the DIY route, plan to spend $500 to $6,000 to pour the foundation. To insulate the home, it’ll depend on what kind of insulation you prefer. Blanket insulation (the itchy pink stuff) will be about ₵45 per square foot, panel insulation will be about $1.20 per square foot, and spray foam, being the most expensive, will be about $2 per square foot.

We recommend looking into the required permits necessary to build this kind of structure. Some areas allow shipping container homes in remote areas with low traffic, while other municipalities have codes and regulations prohibiting them.

Tiny home

Tiny homes are growing in popularity because they are cost-effective, eco-friendly, and they can be put on a trailer, which makes it easy to relocate. These homes don’t necessarily require a foundation, especially if you plan to travel or relocate sometime down the road.

The cost of these homes have a wide price range — a DIY tiny house that’s only 83 square feet could cost as little as $500! On the other end of the spectrum, there’s a tiny home that costs $4.8 million for a paltry 500-square foot cottage… with a 20-acre farm on Maui. With that said, the average cost per square foot is roughly $150.

The cost breakdown for tiny homes will depend on the materials used. Many DIYers use reclaimed wood and recycled materials to keep costs low; costs will also vary depending on what kind of amenities you want, and whether you’d like for your home to stay in one place or want to keep it on a trailer.

Should you decide to have a builder build your tiny home, as opposed to making it yourself, at least 50% to 60% of the price is going to go toward labor — or about double the cost of your materials. For example, if the materials cost you $10,000, you should ballpark your labor budget somewhere between $20,000 and $30,000. (And don’t forget about your hookup costs!) That’s something to keep in mind when trying to decide if you want to DIY or buy.

A-frame

As the name would suggest, an A-frame house is a triangular home that can be built with your two hands; you could use a kit, or you could have a contractor build your A-frame for you. The cost of these homes typically ranges from $3,500 to $35,000, or $7 per square foot, depending on the size, floor plan, elevation, and region.

This type of home does require framing, and it’s best to hire a general contractor because they have the skills to make sure everything is plumb and secure. You can minimize the cost to have the home built if you purchase the materials yourself.

Hay bale/cob

A hay bale (also known as cob) house is unique as it is built with eco-friendly, renewable materials.

Unfortunately, these homes aren’t as cheap as you may think they’d be — especially if you hire a contractor. On average, these homes cost around $88,000. This price tag includes materials, labor, and finishes.

Depending on the contractor, they can install connections for electrical, septic, well, and natural gas hookups, usually included in the price.

Concrete

A concrete house is an expensive build because it ranges between $164,850 and $477,213, or $100 to $200 per square foot. Like other homes, the price you’ll pay will depend on the overall size of the house, the location, and the floor plan. A 2,500-square-foot home with two stories can cost about $180,000.

Since these homes require a lot of skill and knowledge, a professional contractor familiar with these types of homes is a necessity. You can Google “Insulating Concrete Form Association (ICF) suppliers near me,” and you’ll have a list of professionals needed to build your concrete home from start to finish. You can even find mortgage lenders who offer lower interest rates for energy-efficient homes, such as a concrete home.

Is building a house on your land worth it?

Owning a piece of land that’s away from the trappings of everyday life is an appealing dream for many folks, and why wouldn’t it be? You can create your little utopia precisely the way you want it to be instead of living in a cookie-cutter home that’s most likely governed by an HOA.

The cost of building on your land doesn’t have to be expensive. You can build a cozy cottage for as little as $24,000. If you want to live in a log cabin, there are affordable kits that include everything that you need (minus utility hookups). You could even build a concrete house in the middle of Tornado Alley for a reasonable price and know that’ll be virtually indestructible!

When it comes to choosing what type of house to build on your land, you need to consider the desired square footage, the location of your property, and the regional cost of labor and materials. Of course, if you’re a handy person, you could cut costs significantly if you DIY your home.

Whatever you decide, make sure to do your research and remember to factor in unexpected expenses that may arise. With a little bit of planning, you can turn your vacant plot of land into your little slice of heaven.

Header Image Source: (Magda Ehlers / Pexels)

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