Building a custom home is an investment – one of the biggest you will ever make. Whether you are looking to build your forever home or just something to last a few decades, it is important to know the upfront costs. In this blog post, we will explore distinct factors to be considered in the custom home building process that will impact your final home construction costs.  

When you imagine your dream home, what do you see? Walking into your own house for the first time – is it exactly what you pictured? For some people, it is all about the location – they want the oceanfront property or to be within walking distance of downtown. Others have a specific design in mind, while others simply want quality materials and craftsmanship that will last for generations.  

No matter what your priorities are, one thing is certain – building a custom home is a significant investment. But how do you even begin to calculate the cost of something so unique? After more than 60 years in the business, Wausau Homes has a good handle on the cost factors involved in the custom home building process. Here is an overview of what goes into pricing a custom home so you can be prepared when you start working with your builder. 


The cost of building a custom home varies depending on many factors. Here is what we mean. 

Imagine going to the grocery store with a list of items you need for a recipe. The cost of those items will depend on the quality, brand, quantity, etc., that you purchase. You could go to the store and buy all organic, name-brand ingredients and spend $200 on your grocery list. Or you could choose to purchase generic items and spend only $50. The same is true for building a custom home – the cost will depend on the quality of materials, type of finishes, number of square feet, etc. 

A good way to think about the cost of building a custom home is what we call the "Grocery Bag Model." Just like you would not put a steak in a paper bag, you would not want to skimp on the quality of materials and finishes in your custom home. After all, this is likely the biggest investment you will ever make! 

Two bags the same size with a cost differential potentially in the hundreds of dollars. Both bags have the same "square footage," but it is less about the space inside and far more about what you put inside. The same is true with building a custom home. While square footage certainly impacts the ultimate cost of the home, it does not tell the whole story. 


The most expensive home you will ever build is the one that does not meet your needs. Perhaps you wanted a gourmet kitchen but settled for a standard one to stay within budget. Or you were hoping for a luxurious master bath but had to scale back on the size and finishes. It is important to partner with a builder who will help you strike the right balance of cost and quality, so you end up with a home you love that also fits within your budget. 

Wausau Homes has a team of experts who will work with you to create a floor plan that meets your specific needs and wants. We will also help you select the right mix of materials and finishes to fit your budget. And we offer a unique "Ballpark Pricing" method that will give you an accurate estimate of what your dream home will cost. 


Most builders will give you an initial price estimate for your custom home before they start getting into the nitty gritty details. This price is usually based on square footage (i.e. $X per square foot), but it is important to note that there are many other factors that impact the final cost (more on that below). While figuring out the cost of a home based on a square foot method is a helpful starting point, it is not always accurate.  

It is for this reason Wausau Homes prefers to use a ballpark pricing method. While you can look at charts giving you average costs across the nation, your own home is anything but average. But is it possible to get the home you want and still save money? 

Our ballpark pricing method can help you figure out where your money is going and what type of home you can afford within your budget. While many home builders will quote a single price per square foot, we provide a ballpark price range is provided for a house of a specific size and style. 

This is a more precise method of pricing custom homes since it considers the many factors that affect the cost, such as:  

- Location 

- Size and style of home 

- Labor costs 

- Quality of building materials and finishes 

- Number of bedrooms and bathrooms 

- Site conditions (slope, soil type, etc.) 

- Energy efficiency features 

This enables you to assess areas to splurge and areas to save while designing your dream home. Would you want a few hundred extra square feet or genuine hardwood floors? Ballpark pricing helps you make all these choices and get the house of your dreams within your budget. 

Our process always starts with a conversation so we can learn about your vision for your dream home. From there, we will provide you with a ballpark price range based on the size and style of home you are looking for. This gives you a starting point to begin designing your one-of-a-kind home while staying within your budget. 

Before construction begins, you will receive a precise firm price at contract signing once you have completely dialed in your new home design. This will take into account the current cost of building materials and finishes and any changes made to the original design. This overall cost breakdown will also be itemized to see where every last penny is ou can see where every last penny is being spent. 

For a full explanation of our pricing method, check out our blog “Why We Use Ballpark Pricing vs. Square Foot Pricing.” 


At Wausau Homes, we believe in complete transparency throughout the entire home building process. We know you will be in your home for many years to come, and we want you to love every aspect of it. This is about building a relationship that will last long after your home is built. 

Some who have entered the home building process will often get to a point where they are surprised. This is almost always due to a lack of communication or transparency on the part of their builder. Oftentimes, they are presented with a bill that is much higher than they anticipated and are stuck trying to figure out where all the extra costs came from. 

We do not want this to happen to you! We will go over all the costs associated with your home upfront so there are no surprises later. This way, you can make informed decisions about where you want to spend your money and where you would like to save. 

There are no hidden fees or surprises along the way. From the very beginning, we will help you create a budget for your dream home and in many cases can leverage relationships we have made over the years to help you find construction loans to make your dream home a reality. 


Now that we have covered the basics of pricing models, we must consider the overall construction costs and building materials that will impact the final cost of your home. 


One of the biggest factors impacting cost is location. If you build in an urban area, land costs will be higher than if you build in a rural area. Similarly, if you build in an area with a high demand for housing, costs will be higher than if you build in an area with less demand.  


The design will also have a significant impact on cost. For example, a one-story ranch-style home will be less expensive to build than a two-story colonial-style home because it requires less material and labor hours to construct. Home design is often dictated by the size and shape of your lot as well as any setback requirements, so it is important to factor those in when considering home design options.  

Quality of Materials 

The materials you select will also affect cost. If you want high-end finishes like hardwood floors imported from Italy, that will obviously cost more than standard finishes like carpet or laminate. 

If you are looking to install granite countertops, you will again be looking at a higher cost than if you choose laminate countertops. It is important to work with your builder to assess where you can splurge on materials and where you might want to save to stay within budget. 

Labor Costs 

Part of construction costs includes the cost of labor, which will also fluctuate based on location. If you live in an area with an excessive cost of living, you can expect labor costs to be higher than if you live in an area with a lower cost of living. Additionally, the type of tradespeople required will also impact the cost. For example, a home that requires more custom work (like curved walls or an unusual roofline) will be more expensive to build than a home with a more standard design.  

Number of Bedrooms and Bathrooms 

Another factor that affects cost is the number of bedrooms and bathrooms in your home. The more rooms you have, the more material and labor hours are required to complete construction. Each room and bathroom can have a wide range of costs depending on the living space, materials, and finishes you select.  

Energy Efficiency 

Energy efficiency is a big topic of discussion these days, and for good reason. Not only is it important to be good stewards of our environment, but energy-efficient homes also cost less to operate. The cost per square foot will be higher to build an energy-efficient home than a standard home, but you will see savings on your utility bills each month.  

While building an energy-efficient home  eventually save you money, the initial investment to make your home energy-efficient will cost more. Some of the features that make a home energy-efficient are: 

  • Insulation 
  • High-efficiency windows 
  • Energy-efficient appliances 
  • Solar panels 
  • Geothermal heating and cooling 

There are several ways to make your home more energy efficient, each with an associated cost. From simple things like LED light bulbs to more complex features like solar panels, you will need to decide which energy-efficient features are most important to you and factor those into your budget.  

Building Permits and Fees 

There are also several building permits and fees that must be paid to obtain approval to build your home. The cost of these permits and fees will vary based on location, but they are something you need to factor into the overall construction costs of building your home. Building codes are also constantly changing, so it is important to work with a builder who is up to date on the latest code requirements. 

Square Footage 

As we mentioned earlier, square footage is one factor used to calculate initial ballpark pricing for custom homes. But it’s also worth noting that larger homes cost more per square foot to build than smaller homes do because they require more materials and labor hours to construct. Custom home builders can build a luxury home that has all the bells and whistles, or a more modest home with fewer luxurious features. The size and scale of your home will impact the overall cost to build. 

Supply and Demand 

Another factor impacting cost is supply and demand in the building industry. If there’s high demand for housing and a low supply of qualified labor, costs will be higher than if demand is low and supply is high.  

For a more in-depth look at these factors, we recommend diving into our blog titled “5 Factors That Influence Home Cost.”    


Building a custom home is a major investment – but it does not have to break the bank if you do your research upfront and work with a reputable builder who has experience staying within your budget throughout the construction process. 

So how much does it cost to build a custom home? The answer is as complicated as the question, "How much does it cost to make dinner for a family of five?" The answer is: It depends on what you put in your bag. Are you looking for a quick and easy one pot meal or a luxurious feast? 

Planning to build the home of your dreams? It is a significant investment, but there are ways to make it more affordable. By understanding the factors that impact home costs and creating a budget beforehand, you can put yourself in a much better position when it comes time to start building. With careful planning and execution, building your picture perfect home can be an attainable goal. 

Wausau Homes has 60 years of experience and has built more than 200,000 homes- so you can be confident that any surprises will be avoided. With such a long history of success, Wausau Homes has weathered the storms of supply and demand to streamline our process. Even now, as the building industry is in high demand, we have taken steps to make sure our customers not only get a custom home, but they get a personal experience. 

When you partner with Wausau Homes, we'll provide you with a detailed construction schedule and price breakdown before any work begins. We give you the ability to make selections that fit your budget and we do not cut corners. 

No matter what it is you are looking for in a home, Wausau Homes will work with you to make the home you envision a reality. 

If you have questions about our process or would like to get a ballpark price on the floor plan of your dreams, please contact your local independent Wausau Homes builder. They will help you every step of the way, from building a custom home to picking out which type is best for your family. 

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