Every week thousands of people across the nation are searching the web for information on moving to Dallas and the North Texas area in general. Companies and individuals are moving here in droves due to our booming economy, laissez-faire government, low taxes and central geographic location.
Those who land on our blog are clearly contemplating building rather than buying a home here. And while people read our articles for all kinds of related information, all of our readers want to know the same thing:
How much does it cost to build a custom home in or around Dallas?
Whether you’re here because you can’t find an existing home to buy, or because you’re truly passionate about building your own custom dream home, understanding the process is essential to understanding the costs.
So, we decided to provide you with this comprehensive review of the costs, complexities, and inherent risks in building a custom home in Dallas or anywhere in North Texas.
Texas is a great place to build and live. There are practically limitless opportunities to develop private property, including building a custom home, in the state’s demanding but lucrative housing market.
According to current reports, formalized in a December study by Texas A&M University’s Real Estate Center, the number of existing homes available for purchase in the Texas market is at a historical low. Homes are being sold as soon as they are listed, often at above-listed prices, creating scarcity and making new customers bid for a limited number of available homes.
At the same time, there has been a surge in demand for new, custom-built homes. The Texas A&M analysis further revealed that Texas has experienced a steady increase in applications and approvals for single-family building permits. The state’s five largest cities approved 11,818 permit applications in October 2020 alone (the most current month measured in the study).
In other words, you will be in competition with many others desiring to build a custom home, well into 2021 and beyond.
When you plan for building in 2021, be aware of the Covid pandemic’s increasing ripple effects on supply chains and the construction industry in general. For example, last fall, supply chain problems caused the price of lumber in Texas to nearly triple until a tariff was imposed to restore equilibrium. However, current prices remain at historical highs, and if unpredictable price spikes occur, thorough analysis of pricing options and a flexible building plan are your best protection against overpaying.
With all of this taken into consideration, this article reviews the possible costs of building a new home in Dallas, covering every aspect of the building process and the information you will need. Bear in mind that the following analysis and suggested costs are an attempt to capture “average” costs of “average” new houses being built in Dallas and North Texas in general. Your individual preferences and budget for your custom home design will determine final costs.
Land Prices in Texas
Before you start to design your custom home, you need to know where your property will be located, because location will affect both the overall price of your custom home as well as the flexibility you have in your house design.
On average, a 0.25-acre of land should be enough to build a family home with room for a garage, garden, and lawn space.
You must check with the community in your preferred location to know the restrictions and allowances for building a family home, as many communities today are creating rules for lot size, building specifications, and usage to protect their community and maintain aesthetics.
As with many metropolitan areas, the average cost of land in and around Dallas (and Fort Worth, its twin-city 30 minutes west) varies widely by location. You can expect to spend anywhere between $2500 – $3,000 per acre for undeveloped land around the Dallas-Fort Worth area. However, in areas where development has already started, land cost may be much, much higher.
Just two years ago, the median price for an acre was $2411, inferring that land costs are rising over 10% each year.
When buying land, keep in mind that there are two types of plots:
- Subdivided lots
A subdivided lot is a larger piece of land that has been subdivided into smaller lots by an individual or developer. As this category of land is intended for development, you may find amenities associated with the property, such as highways or other infrastructure, shared community facilities like pools, parks and playgrounds, or a gated security entrance to the development.
A subdivided lot is registered at the county level, and it may be subject to deed limitations or a Home Owners Association (HOA) – more on home owners associations later.
- Unplatted or undeveloped land
Compared to subdivided lots, an unplatted property is usually less expensive per acre, but more expensive to build on. This is primarily due to the sizable costs you will incur for grading, infrastructure, driveways, utilities, etc.
Choosing a House Plan
Once you’ve chosen your location, you can choose your home’s design and specifications. As you do, don’t overlook the following considerations:
Note that we discuss specific costs to help you calculate your budget in the sections below.
While this is the exciting part of building a custom home because you get to decide the look and feel of your design, it is important to make the decision with your budget in view.
If you don’t correctly forecast your budget, loan financing, and the total cost of building a particular house style, with all of your specific upgrades and amenities, you may outstrip your resources to finance the project.
Restrictions and Limitations
Another consideration before choosing a house plan is the restrictions that may be imposed by deed and by any property owners associations your land may be subject to.
A deed may contain restrictions on how you can use your land. Deed limits will control what you can and cannot do on your property, as well as what you can build on it.
- Property Owners or Home Owners Associations limitations
If applicable in your home’s location, a property owners association (usually the Home Owners Association or HOA for short) in your neighborhood may play a huge role with additional regulations, usually found in the association’s bylaws. Over the last 40 years, the influence of Home Owners Associations across America has skyrocketed, and this is true in Texas. It is estimated that 75 million residents in the United States live in areas governed by HOAs, which have building standards and rules which are created maintain the character of the community, and which homeowners are legally obligated to follow.
Costs by House Type
Unless you’ve got a rich budget and an exceptional architect, at the end of the day your custom-built home will be based off of one of the following styles of houses. And, while all of the home styles detailed below offer endless possibilities for customization, it pays to keep your design in-line with conventional standards if are concerned about resale value. Extreme designs appeal to fewer potential buyers, while more conventional designs appeal to more potential buyers.
With that in mind, let’s review the top 7 types of house plans in Texas.
Top 7 Types of House Plans in Texas
1. Ranch-style house
Texas is known as the Cowboy Capital of the World, so it should come as no surprise that one of the most popular house styles in the state is the “Ranch” style house.
The ranch-style house, which dates back to 1932, rose in popularity during the 1950s and 1960s and is still popular today. Ranch architecture is characterized by a (typically) straightforward, single-story floor plan, low-to-the-ground appearance, and an open structure design.
Ranch-style homes stand out with a low-pitched roof and (usually) an attached garage. In Texas, their yard size is limited only by the number of acres the owner can afford. Modern variations of these homes promote an indoor-outdoor lifestyle, with wide windows and sliding glass door designs.
While ranch-style homes in other parts of the country often have basements, here in Texas that is not typically the case. We would ascribe this to a) the high cost of excavating our rocky land to create the space for a basement, and b) the general availability of larger land lots, allowing us to expand our living space horizontally rather than vertically.
When you build a ranch-style home, you are automatically creating an in-demand property. Real estate sales data shows that ranch-style houses are popular and have the highest sale-to-list ratio in several markets including Texas, Virginia, Portland, Phoenix, Chicago, San Francisco, and San Diego. Translation: a ranch-style house is more likely to sell above the listed price in Texas.
To summarize, here are the typical characteristics of a ranch-style house in Texas:
- Single story
- Open concept floor plan
- Rectangular, “U,” or “L”-shaped
- Devoted patio or deck space
- Large windows and sliding glass doors
- Low-pitched roofline with wide eaves
- Often features an attached garage
Ranch Houses Come in Five Varieties
While most ranch houses share similarities, there are some details that can set them apart. Here are several distinct ranch-style designs that cater to various homeowner preferences:
The California ranch, also known as a rambling ranch, is distinguished by an L- or U-shaped frame constructed low to the earth. This sprawling, single-story architecture is meant to fit in with nature. The California ranch has a pool and a front garden. (Related: Aged people, 50 and above, prefer California ranch-style homes because they are low to the ground and easily accessible.)
While similar to the California ranch with its L or U shape and open-floor style, the suburban ranch is more streamlined and asymmetrical in form. Also, it comes with a garage and a courtyard.
The exterior of the split-level ranch is similar to that of the suburban ranch, but it has two floors of sprawling living space. A split-level ranch house has a front door that leads into the living, dining, and kitchen spaces. Also, they have half-flights of stairs that lead to bedrooms and additional living space.
Like the split-level ranch, the raised ranch has multiple levels of living space but with a distinct style. The raised ranch’s front door opens directly to a staircase that leads upstairs, with the kitchen and bedrooms usually on the upper floor.
The storybook ranch is distinguished from other ranch types by its ornate features. This architecture includes diamond-shaped window panes, decorative brick or stone chimneys, and a steep, gabled roof.
The cost of building a Ranch-style house in Dallas, Texas
A ranch-style home in Texas costs the same as most house styles. You can expect to spend between $100 and $200 per square foot on average. At the low end of the price range, ranch-style homes are simply one-story houses, with low-to-the-ground profiles and easy access from multiple sides of the property. However, sprawling ranch homes tend toward the high end of the price range, with larger-than-average footprints which cost more primarily because of the additional foundation costs.
2. Craftsman-style house
Late-nineteenth-century Victorian homes were designed to showcase American engineering advancements and industrial invention with their over-the-top detailing. By contrast, the Craftsman revolution that followed was a direct counter-response, favoring hand-made products and buildings over mass-produced goods.
At the turn of the twentieth century, the American Craftsman architecture movement evolved from the British Arts and Crafts movement, which evolved as a similar reaction to Europe’s Industrial Revolution (viewed by many as devaluing human labor).
Craftsman-style homes share many characteristics that make them easily identifiable, and they are as common today as they were more than a century ago. In contrast to Victorian-style homes, Craftsman houses prioritize horizontal lines, with low-pitched gable (triangular) roofs that extend beyond the home’s outer walls, sometimes revealing the beams.
Craftsman houses adopt an artisanal approach to surface decoration, fusing hand-made local materials with architectural features such as brackets, lintels, and rafters.
The over-extended eaves of Craftsman roofs allow for large porches on the front of houses with tall, tapered columns across the perimeter. The exteriors of these homes were mostly painted wood cladding; however, stucco or stone accents were used very often as well—the general theme was an emphasis on earthy tones.
The interiors of Craftsman homes are as distinctive and essential to the designer as the exteriors. Craftsman homes use wood for designs, from the thick trim around doors and windows, squared beams around the roof, built-in bookshelves, and window seats. Other prominent features include a fireplace (or two).
The cost of building a Craftsman-style house in Dallas, Texas
The national average for building a craftsman-style home is between $125,500 and $345,000, which is in-line with Texas. Size and choice of building materials drive price.
3. Contemporary-style house
Simply put, contemporary homes embody today’s architectural standards. The contemporary house design is a response to the ever-changing architectural trends of the twenty-first century.
Most contemporary homes have a minimalist feel about them, with architectural cues from postmodernism and deconstructivism mixed in good measure. Unlike other house styles, contemporary homes emphasize the quality and effect of the construction material on nature.
There is a strong focus on renewable and natural materials – using recycled materials to build furniture or a container-home, for example.
Contemporary homes are popular because they incorporate nature and defy conventional architectural styles. Historically, the latest architectural style is usually the opposite of its predecessor. For example, the simplicity of Craftsman homes contrasts sharply with the over-opulence of the Victorian period that preceded it.
However, contemporary architecture does not follow this pattern. In reality, this style takes after its predecessor, modern-style architecture, in many ways. It took what worked, as shown by the reliance on clear, basic lines and a link to nature, and corrected what didn’t. Contemporary homes have a warmer design than modern-style houses.
Features of contemporary interior design:
Clear lines: The interior design, like the exterior, has prominent, clear lines. The furniture is constructed from a variety of geometric forms and recycled materials. There can be boxed furniture and round seats in the same room.
Minimal decor: Contemporary-style design follows a minimalist and practical approach. That means only useful furniture or features are used. As a result, contemporary rooms look larger when plain.
Simple decoration: Contemporary homes use one or two pieces of artwork to create a focal point in each room. The walls are kept bare so that they don’t obstruct the space or detract from the natural landscape seen through the windows.
Neutral colors: The color palette of contemporary rooms is limited. Walls and furniture are usually beige, cream, black, or green. To add contrast, one or two objects in each room can have a pop of color.
The cost of building a Contemporary-style home in Dallas, Texas
From this brief description of details, it is clear that contemporary homes are unique and require specialized skills in both design and construction. Consequently, they are more expensive to build than a traditional American home. In this category we are not able to provide a reliable price range due to the subjective nature of the designs and their associated pricing, but you can expect to pay 25% – 50% more for a Contemporary-style house vs. a traditional house design.
4. Modern-style house designs
The modern style arose in reaction to the late-nineteenth-century Victorian architecture, which was overly ornate, cluttered, and fancy. Compared to Victorian, Edwardian, and Art Deco homes, modernist-style homes had a distinct lack of decoration and flair.
These types of homes have a precise horizontal composition, wide-open floor plans, deliberate asymmetry, and large expanses of glass windows or glass walls. The goal here is to build a simpler home with an emphasis on functional features to eliminate needless parts and furniture. Consequently, modern-style homes are spacious and great for living.
Like contemporary homes, modern-style homes merge the inside and outside with ground-to-ceiling windows, open spaces, and manicured exterior to improve the view. Nature lovers will enjoy a modern-style home because of its minimalist approach and nature integration.
The cost of building a Modern-style home in Dallas, Texas
The cost of a Modern house design built in Texas, with vast expanses of ground-to-ceiling glass and many different floor plans available, ranges from roughly $750,000 to $15 million or more. This wide range in cost can be attributed to the wide-ranging prices of the land/location opportunities available in different areas, the square footage desired, and the complexity of each unique design.
5. Cape Cod style homes
A Cape Cod house could be described as a traditional American cottage, as these charming and simplistic designs are recognized as symbolic American homes.
Although they can be scaled to any size, Cape Cods are typically just the right size for an average American family. These types of homes are easy to heat and decorate.
This popular American house style takes its name from Cape Cod, Massachusetts. The origin of the Cape Cod-style is traced to the time of the first Puritan settlers. Cape Cod was an adaptation of the concept of an English cottage, tailored to suit America’s climate.
For example, the symmetrical architecture centered on an expansive, open living room – or “hall”- is English in origin.
Cape Cod homes use steep roofs, originally to reduce the weight of snow in winter, while the characteristic low ceilings save heat, and the unique shutters keep out cold winter winds. While they are not common in Texas, they stand out when done well.
Characteristics of a Cape Cod-style home
Cape Cod homes have a few distinguishing characteristics that make them stand out:
- Symmetrical look with a centered front entry
- Roofs have a steep pitch, side gables, and an overhang
- Dormers with gables
- Shutters on double-hung windows
- Siding made of shingles
- Chimneys that are centralized
- Simple exterior decoration
- One or two story designs
- Ceilings that are low
- A symmetrical plan with a central hall
- Large, open-plan living area
- Bedrooms in dormers or underneath eaves
- There are few aesthetic details and the lines are clean
The cost of building a Cape Cod-style house in Dallas, Texas
The cost to build a Cape Cod in Texas ranges between $163,000 and $326,000. As with other designs, size, finishes and additional amenities drive price.
6. Colonial-style homes
The history of American Colonial architecture is somewhat self-explanatory: it emerged as a standard house style in the American colonies under colonial rule (the 1600s to mid-1700s). There are examples of Spanish, French, Dutch, and British Colonial architecture in the United States, as immigrants from many of those nations lived in various areas of what is now the United States for different lengths of time.
Traditional American Colonial homes are generally simple in design. Brick and wood are the usual building materials, and they are rectangular, usually two stories, and somewhat symmetrical. The size and dimension of the roof determine the overall appearance of an American colonial home. Typically, American-style homes have steep, side-gabled roofs, and you can only see the triangular part of the roof from the sides. When you view from the front entrance, you only see shingles.
The cost of building a Colonial-style home in Dallas, Texas
Based on the features of this home style, you can assume that it will be less expensive to build than some other popular designs. That said, you can expect to spend from $140 to $300 per square foot to build a classic American Colonial home. The choice of material and finishes determine the final cost.
7. Tudor-style homes
For the last century and a half, many Americans have been drawn to the dramatic, romantic, old-world feel of Tudor homes. You don’t have to be a design expert to recognize a Tudor home. Their distinctive gothic appearance separates them from other more symmetrical, lighter, and modern styles.
Tudor houses come in a variety of sizes. Smaller Tudor homes have a cozy, fairy tale, storybook look, while larger Tudors reflect the charming ideal of an English country manor.
Tudor homes are built with expensive materials, solid masonry, and decorative features. Consequently, they are costly to construct and are often found in affluent suburbs or estates.
Characteristics of Tudor-style homes
Unique windows: Tudor house windows pay a rare homage to medieval architecture. Windows are tall and small, with several panes that may be rectangular or diamond-shaped. The windows are usually colored.
Triangular front door: The front door is an essential architectural feature on Tudor houses. They usually have a triangular arch at the top and are surrounded by a colored stone that contrasts with the brick walls. Finally, Tudor chimneys are another noteworthy feature; they are designed to be striking visually and to improve the home’s appeal from both inside and out
The cost of building a Tudor-style home in Dallas, Texas
While there is no specific range for the costs to build a Tudor-style home, it is generally accepted that Tudor homes are more expensive than other house designs in America.
In general, you can expect to pay anywhere from $50 to $155 extra per square foot than the standard rates for a traditional-style home in your area. The increased costs are due to the expensive nature of architectural elements of a Tudor home, which are all custom-made by skilled craftsmen.
General Cost Estimates for Each Stage of Building a New Home in Dallas, Texas
Building a new home requires wearing many hats; you have to know a bit about design, furniture, finishing, and construction. But the primary concern will always be the cost of building. You are going to pay for the whole thing, so you should have an idea of what it should cost.
If you choose to work with a custom home builder or construction firm, you will have a dedicated project manager who will outline the cost of each project stage.
Note that you should add a “buffer” of around 10% of the cost of each of the following stages, for unexpected changes or cost overruns.
Cost of House Plans and Permits
You can expect to spend anywhere between $2,000 and $8,000 for a standard house plan, and far more for custom, elaborate designs. In fact we know several owners who paid over $100,000 for full custom plans for larger, elaborate home designs.
A consultation with a qualified architect will provide you with an accurate estimate for the cost of your desired house plan, and as with most hired professionals involved in the building of your custom home, the best way to get an architect is through referral.
Keep in mind also that you can find a variety of home design companies on the internet. Use history, reviews, and pricing to filter through the thousands of providers available.
You will need the following professionals to build and finish your home:
Architects: $130-$250 per hour
Engineers: $100-$150 per hour
Custom Home Builder or General Contractor: 10%-20% of the total project cost
Interior Designer: $50-$200 per hour
A word of advice: Allow your architect and contractor to collaborate on the house design, to ensure that your architect does not design anything unachievable or prohibitively costly to build.
Once you have selected your home style and design, and before you can begin construction, you must secure all necessary permits. According to HomeAdvisor, the average person spends $1,200-2,000 on permits and fees while building a home in Texas; however, prices can vary greatly based on local regulations.
Usually, you need a house plan to apply for a building permit. It takes around 11 weeks currently to get a building permit in Dallas. Based on the permit application phases published by Dallas City Hall, you will go through a pre-screen, plan review, and application approval stages.
The first stage is a preliminary check to ensure that the plans are formatted correctly, and all documents have been submitted.
In the second stage, plan review, your plan will be reviewed based on the Dallas Development Code or the building codes of the city of your location.
In the third stage, your permit is issued once your plan has been approved and any outstanding fees/debts are cleared.
Permits are normally valid for the length of time it takes to finish constructing your home.
While the process of getting permits may seem overwhelming, it is a necessary step that cannot be overlooked or avoided. Homeowners who don’t have a building permit face steep fees, denial of insurance coverage, or even demolition.
Aside from the penalties, there is an even more critical justification to secure permits: your well-being and safety.
Municipalities require permits to ensure that homes are in compliance with current building codes. In Texas, these codes prohibit residents from constructing homes which might be unsafe or unsuitable for the standards of the area.
Construction Phases and Average Costs
- Planning phase – budget $18,000
Before you can start building, you need to survey the land, get a house plan, and obtain a building permit. Each step costs a significant amount of money, and you should budget around $18,000 for this stage of the project.
The biggest expense here is the fees for obtaining a construction permit. Based on the current fee structure, you will be charged $0.004 per square foot for site plan review and $0.012 per square foot of building area for the plan review.
Next on the list are the fees for sewer and water inspections, which can cost up to $4000.
Also, if you purchased unplatted land, you may need to do excavation work which will require a special excavation permit.
Finally, be aware that the government could bill you as much as $2,000 (or more) as impact tax, which pays for public facilities such as bridges, parks, and water treatment, dependent on your location.
For a detailed cost breakdown of required permits, visit Dallas City Hall’s website.
In summary, for site preparation, survey, and house plan design (architectural design), you can expect to spend $18,000 or more.
- Foundation phase – budget $35,000
The real fun starts with the foundation work. This is the stage where you break ground on your new home. Excavation or ground-breaking requires heavy-duty machinery and skilled operators to ensure that the land is level before laying the foundation of your home.
While the size of your home’s floor plan may cause this cost to be higher, the average home budget for this phase is around $35,000.
Also, keep in mind that excavation costs may skyrocket if large rocks are discovered underneath your plot of land, which is common in many parts of Texas.
- Home framing phase – budget $52,000 and expect to pay more
Prepare to be surprised. The frame of your house will be one of the most expensive items in your house-building budget, usually only surpassed by interior design cost. This stage can cost as much as $41,000 or more for a standard house of 2,500 square feet.
If the woodwork for the roof is not included in the cost of building the roof, you will need to add at least $6,000 to the framing budget.
After the frame of the house is in position, you have to spend another $3000 for sheathing. Think of sheaths as the skin that protects the home’s frame. And, if you add aluminum or steel components, the framing costs can increase substantially.
Finally, due to the massive amount of lumber required to frame your house and the volatility of lumber prices, be prepared for unexpected cost increases in this phase of construction.
- Exterior finishes phase – budget $42,000
The exterior wall has one of the largest surface areas on your property. As such, it will cost a reasonable sum to complete the finishing (estimate for average cost = $19,000).
Additional exterior finishing includes the installation of doorways, windows, and garage doors. You should expect those expenses to be in the range of $12,000. Roof finishes would cost an additional $10,000.
- Major systems installations phase – budget $44,000
In this stage, you will install several systems, including plumbing ($15,000), HVAC ($14,000), and electricity ($14,000).
- Interior finishes phase – budget $75,000
The interior is typically the costliest phase in the construction of a home. This makes sense, given that you’ll spend most of your time enjoying the inside of your home and the environment you create.
At this stage, you will choose the finishes based on preference and in accordance with your house style. Do you like the look of granite countertops? Do you prefer hardwood floors? Do you want unique windows? Many such decisions must be made, each with their associated costs.
- Landscaping and driveway work phase – budget $20,000
Once the exterior finishes are done, the final phase of development would be focused on the external elements such as landscaping and a driveway ($7,000 each). These also include ancillary structures such as a porch, lawn, or deck (more than $3,000). Also, the final clean-up will cost up to $3,000.
- Final phase, Miscellaneous Costs – budget $11,000
Aside from the “buffer” sums included at each stage of the construction, you should keep about $11,000 for miscellaneous expenses. These could include unexpected construction challenges, equipment replacement, additional excavation, or any number of other unanticipated costs.
Cost Savings: Do-It-Yourself vs. Hiring a Home Builder
Both your house style and choice of builder will have a tremendous effect on the price you will pay for your custom home in Dallas. If you have the time and the necessary skills, you can save anywhere from $20,000 to $60,000 by managing the building of your house.
Most of the savings come from being your own general contractor. You might as well call this as “payment for the stress” because overseeing construction requires physical and mental grit.
Building an average 2,500-square-foot home takes months, even with an experienced workforce and subcontractors leading the charge. If you choose to build independently, you will need to consider the nuances of planning, building codes, and coordinating trades and schedules.
Unless you absolutely must reduce your costs, we strongly recommend using a custom home builder, or at the very least using a general contractor for the building and finishing.
How long will it take to build a custom home in Texas?
Other things being equal, your house style and complexity will determine the construction time required. A simple, traditional-style house might take 8 to 12 months to complete. However, if you want to stand out in the Dallas architectural scene with a Tudor home, for example, you should expect the construction to take 10 to 16 months to complete.
If you are wondering why the timeframe is significantly higher than the time posted by conventional builders, it is because those companies use pre-set designs and limited materials options for construction, reducing the overall timeline to completion.
If you are building a truly custom home, you will need to design the plan from scratch, to your standards, and the customization process will be filled with back-and-forth consultations with your architect, builder and with contractors until you get the final design you want.
Also, building a custom home requires hiring specialists who may have tight schedules which you will have to work around, and which may prolong your construction schedule.
Building a custom home is a challenging but rewarding task. Since cost is a primary deciding factor, we’ve gone over the steps of building and the possible costs involved at each stage.
It is important to note that there is no standard price for building a custom home, so the budget numbers provided above should only be used as a starting point. Be prepared to spend more, and be happy if you spend less, because the building process – even for similar house styles – is never the same.