Whether to Build a Custom Home or Invest in a Subdivision

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How to Know If You Should Build a Custom Home or Invest in a Subdivision 1

How to Know If You Should Build a Custom Home or Invest in a Subdivision

You’re looking into buying a new home. You know what features you’d like in your new house but aren’t sure how to best bring them to life. One of the first things you’ll need to consider is whether you want to design a custom home from scratch, or choose from a master builder’s array of prepared options and invest in a subdivision.

How to Know If You Should Build a Custom Home or Invest in a Subdivision 2

How much does a custom home cost?

The cost to build a home tailored to your unique wants and needs will vary depending on a number of factors ranging from the land you purchase, the home’s size, the building products and materials used, and the intricacy of the design.

Part of the cost of a custom home involves the work with a designer/builder to draft your personalized floor plan. This dialogue will allow you to design around, and more elegantly incorporate, unique features on your piece of land, like elevation changes, trees, and rocky outcrops.

Although you’ll likely enter these discussions with a budget in mind, discussing your plans with the designer/builder will often lead to new ideas for your home, helping you build and adapt the budget during the process. This communication will help you avoid an over-designed plan that bloats the building cost beyond your budget.

In any event, you’ll need BCIN (Building Code Identification Number) licensed construction plans before you can build your custom home. Your designer/builder will provide that certification, along with the multiple other permits needed to construct your house. As with the planning itself, all these permits will make up part of your new home’s final cost.

Budget, building codes, and zoning limitations: these are some of the main factors you’ll need to consider when building your dream house.

How to Know If You Should Build a Custom Home or Invest in a Subdivision 3

Are there extra costs for a custom house?

Because of economies of scale, all other things being equal, a custom home builder will be more expensive simply because they don’t purchase land and resources at the same volume as a master builder.

Since custom hoses are much less standardized than subdivisions, there can be added costs that vary from property to property. If you want added privacy, you might want to set your house far back from the road. This could add the cost of a longer road, design, engineering, labour, and resources.

Once you’ve established a plan with your builder, any additional customization will increase costs. As you’re not on a managed subdivision, you’ll also have to cover the cost of clearing and preparing the undeveloped land. Site prep involves excavation, building a driveway, and bringing in utility lines (water, electricity, gas, sewage).

How to Know If You Should Build a Custom Home or Invest in a Subdivision 4

What are benefits of building a custom house?

Beyond the benefit of personalizing a floor plan and design that caters to an owner’s unique vision, there is much more leeway with budgeting as this vision is brought to life. Custom homes tend not to be built on spec, with their design often guided by the unique attributes of the lot already purchased by the owner. The landscape of the lot offers inspiration, presenting opportunities for vantage points from the home and creative access from the public road on to the property, among other things.

With a custom home, a designer assists the owner with selecting every finishing detail, guiding them to each choice based on factors including personal taste, lifestyle, and budget. When building a custom house, your lot is a canvas, your final product determined by your imagination and your budget.


What does investing in a subdivision involve?

A subdivision will typically offer the land and home as a package, with a range of houses to choose from. The range of houses will be presented based on style or design, helping categorize floor plans and exteriors for whatever general features a homebuyer has in mind. Generally, the square footage and number of rooms in each floor plan remain the same, although the master builder offers a number of options for customization.

These floor plans can be mixed with a few different models that alter the placement and shape of windows or size and style of a front porch, to add a bit more variety for the consumer. The houses are also categorized by price, aiding homebuyers based on how much they have budgeted.

Subdivisions tend to be large areas of land purchased by a master builder in bulk, with savings passed on to the consumer. Subdivisions also have utilities at the lot, ready when you are to start building your house.

Subdivision homes often have “builder grade” budget materials included in their base price. This makes the finished home product initially seem like a bargain. This finishing is done in a fairly standardized assembly-line fashion and involves less attention to detail than that which you’d find in a custom home.

Once you have a good idea about how your new home budget, must-haves, and dream features align, you’re in a good place to know whether a custom home or subdivision investment is right for you.

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Ken Jaquith Director Of Client Experience
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