The cost to build a luxury home can become the biggest hurdle in your plan to have the dream home you want.
But do you have to spend more than what you can afford to live in a luxury home? Are there ways you can build your dream house without spending tonnes of money?
The good news is there are ways to cut your luxury home construction cost. Find out how by learning the pricing of home construction in Toronto and understand how you can help minimize expenses and determine your alternatives.
Differences Between Soft Cost and Hard Cost
The cost to build a luxury home comprises two main expenses, hard and soft costs.
Hard costs are the fixed costs, which include the costs of the trade and materials. The price is fixed and won’t change unless you add or eliminate the items part of it.
The soft costs are the indirect charges needed for the construction. Examples are fees for permit application, arborist reports, and municipal fees. For a 3200 sq. ft. home construction in Toronto, the average amount you have to pay for the soft cost is around $30,000.
How Much Does It Cost to Build a Luxury Home Per Square Foot?
There is no one-size-fits-all answer to this question, as luxurious houses have different features, sizes, and materials.
To know what to expect, the average cost to build a luxury home per square foot in Toronto is anywhere between $200 to $350. This price can go higher, depending on how luxurious you want your home to become.
For example, the following can add to the cost to build a high-end home per square foot.
- Hydro lines connection
- Other unexpected fees (extension of communication wires, removal of trees, security alarms, etc.)
The cost to build a high-end home per square foot can go as high as $400, especially if it has environment-friendly features. Environment-friendly houses are typically more expensive upfront, but they will save the owners a lot on electricity and water bills in the long run.
Besides that, other considerations, such as the finishes, architecture, and other factors, can affect the price. The fluctuation and location are also considerations. For example, building a luxurious home in Toronto is more expensive than it is in Halifax.
Length of Time Needed to Build a Luxury Home
The length of the construction project depends on different variables. It includes the size of the house and the features and amenities you want to add. The construction plan also plays a significant role in determining the length of time needed to build your dream home. If the plan is detailed, organized, and well-set, there’ll be fewer hurdles along the way.
Because the cost to build a luxury home in Toronto requires a serious amount of money, make sure to start with developing a well-set construction plan before the commencement of the project. Be sure not to miss anything to help speed up the work. If something is missing from the plan or doesn’t work, it will waste time and money.
If the plan works out, it will only take approximately less than a year for your builders to build a medium-sized luxury home.
However, other factors can delay the construction process, such as accidents, lack of staff, and bad weather.
Tips in Reducing the Cost of Building a Luxury Home
It is possible to buy a house for $100,000. However, it is impossible to build a luxury home from scratch with this budget. But even if the cost to build a luxury home requires a large budget, it doesn’t mean that you cannot implement ways to cut some costs.
You can consider the following actions if you want to lessen your expenses:
Ask for bids
Take several contractors to bid on your dream home project. However, do not jump at the first cheapest offer you get. Undergo further research into the company as there can sometimes be an unpleasant reason behind their cheap prices.
Consider the Size of Your Home
The larger your dream home is, the more expensive it will be. Even if it is the case, it is crucial to consider your needs and the long-term benefits that you can get. It is better to pay more initially if you get lifetime comfort and savings in return.
If you buy a small home only for the sake of cutting the cost, you might end up spending more in the future because of the extensions and renovations that you’ll have to do.
Use a Standard Home Design
The general rule is the more customized your home is, the more expensive it will become. Ask your builder about the pre-design options they can offer.
Take Some of the Work Yourself
If you have some DIY skills up your belt and are confident in your abilities, you can trim down some labour costs. Examples of some DIYs you can do are light installations, painting, and flooring installations. However, if you are not confident in your skills and need to work on the plumbing and electrical systems, leave it to the experts.
Reuse and Recycle
There are a lot of places where you can find excellent second-hand and cheap furniture. If you know how to look, you might get some hidden gems in thrift shops and yard sales.
Where to Get a Loan to Help Build a Luxury Home?
The cost to build a custom luxury home in Toronto requires a serious amount of money, but it does not mean that your dream home will have to remain a dream. There are institutions where you can get a loan that will help finance your investment.
One example is a progress-draw mortgage where you can borrow some money for a home construction. Different institutions have their policies on this. Generally, the money is given in every construction phase while the project is in progress.
Another type of construction loan is a completion mortgage, where you can get financial assistance to pay for a newly constructed home you bought from a builder. The payment is only required when your luxury home is complete.
However, the construction loan is only for the home itself. If you need financial assistance to get vacant land, you will have to obtain a separate loan, which commonly has a higher interest rate. You also need to pay a down payment to cover the building costs, which can range from around 25% to 30% of the construction cost.
If you want to avoid the setbacks that will cost you more money to build your dream home, get an expert to work with you. Find a reliable builder who can provide you with a detailed list of all the hard and soft costs. Moreover, your builder should help you create a clear plan and maximize your budget.
Contact BCR now, and let’s talk about your plans.