New Construction Costs

6 Replies

Hi all,

I just picked up a 600 sq ft house in the Regis area. I was hoping to gut it and add 800 square feet on the back but I just learned that it has no foundation!   It looks like it'll have to be scraped. 

I need to build new at $100/sq ft maximum not including demo, plans, professional services, and water tap which I have in for $18k.  It's a half lot (3,120).  Mid-grade finishes which I can source myself to save $.

Is this doable NOW and in this market?  

Any suggestions or feedback is appreciated.


Hi Danielle,

To know if it is doable there are a number of things one would need to know.  1st, what do you know about the current market in the area your property is in? If you are adding 800 sf to a 600 sf residence, will there be a problem with the size of the footprint compared to the lot size? 1400 sf is approaching 45% of the 3120 sf lot size.  Some municipalities have a restriction on lot coverage.  What are other 1400 sf houses in the area selling for?  Plans, Engineering, Energy Calcs, and Permits all need to be factored into the cost as well as holding costs, taxes and utilities.   What did you pay for the property?  If no foundation on the 600 sf, it may not qualify for a loan and you may need to either get all cash or take back a good portion of the sales price.  I would say, the foundation should definitely be addressed.  Are you going to hold or flip?  If flip, sell with RE?  If so, factor in the commission.  So . . . run the senerio by a reputable GC.  He should be able to give you at least some "ballpark numbers" for the foundation, framing, plumbing, ele, etc. Now work the numbers backwards.  I am not familiar with your neck of the woods so I am not going to even try to address those things.  Not knowing how seasoned you are as an investor, I hope I'm not  preaching to the choir.  Hope it does work out for you.       

Sorry about the lack of info - I thought I was posting on a board specific to Denver!  Yes, I'm a seasoned investor but new to scrapes, so I was looking for feedback on construction costs specifically.  Apologies for the confusion and thank you for the long reply!


I have no idea what new construction costs in your area, and I have no idea:

- What level of finishes you plan to use

- What types of contractors you plan to use

- How much construction knowledge you have

- What type of house you plan to build

- How good your negotiation skills are

- Whether you'll be managing the project or hiring a GC

Without all that information, it's impossible to know what it will cost you to build what you want to build.

That said, I'd be very surprised if someone with experience was unable to build builder grade new construction for less than $100/sf in that area.  As data points, between us and others on this board, we are building at under $90/sf in Georgia, Maryland, Texas, Florida, Utah, Virginia, North Carolina, etc.  So, that tells me it's likely that you can do it in Denvert as well (though perhaps Denver is ridiculously expensive for some reason I'm not aware of).

It's really more a matter of what you're trying to build and your specific experience.

Its running around $120-$150/ft in Denver. Pretty much everything has higher level finishes since scrape projects are in areas that support 1.5-3x median home prices. Nobody besides national builders are building entry level type homes, even then it's tough to find a new built detached home below median in/around Denver. 

All the contractors doing new construction are really busy so the prices are higher. Some rehabbers are venturing into that area because supply of flip homes is so low. I have seen there is a shortage of framers. Shortage results in higher prices. I would be really surprised that you could get something built for $100/sqft, especially when the square footage is on the lower end. Once you have a kitchen then having a larger kitchen is cheaper on the square footage basis. For example, the kitchen (typically the most expensive room in the house) in a 2,500 square foot house costs nearly the same as one in a 3,500 square foot house.

I'm with Anson and Bill on it being tight to get to $100/sf when you still have design/ professional services / demo, etc.  It's good you can self-sourcing finishes but it's still a push.

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