Updated for 2024
Building a new house is like setting out on a journey. It’s exciting, nerve-wracking, and an experience of a lifetime.
When building a new home, the first step is learning about the factors that will influence your new build. It may seem intimidating, but learning about them will help you plot a clear route forward. Don’t worry! We’re here to help.
Factors Influencing the Cost of Building a House in Portland & Seattle
Although the cost of building a new house in Seattle and Portland is always changing, the factors influencing those costs remain the same.
These factors fall into the following categories:
- Site
- Location
- Design
- Building
- Current real estate trends
- Permits, fees, and other pre-construction costs
The Site
When building a house in Portland or Seattle, one of the most influential cost factors is the land it is being built on.
Be sure to ask the following questions when searching for the perfect spot for your new home:
- Does the land already have utilities like gas, water, and electricity?
- Is the site ready for construction?
- How big of a lot will you need?
- Is the lot already occupied?
… when deciding on the site where your home will be built to get a more realistic idea of how much it will cost to build a house on the property.
Securing a place for your home could range in cost from $75-$700k. If you are fortunate enough to already own a site, scratch this line item off of your budget.
The Location
Location plays a significant role in what it will cost to build a house in Seattle or Portland. High-growth, small markets generally have a greater cost to build homes than low-growth, larger markets.
The cost to build a home doesn’t stop at market rates, additional factors that come into play include:
- Distance from big cities and urban areas
- School districts
- Taxes
- Amenities in the area
- City rules and regulations
The Design
Your home’s appearance and how it functions are the products of a collaborative process between you and a design professional.
An architect or designer can help:
- Translate your vision into something tangible
- Assist in finding land; and
- Coordinate with engineers, the city, and other designers — learn more about how we partner with architects
A ballpark estimate for architectural services is 10% of the total construction budget. Things such as engineers, permits and fees, demolition, and site development cost additional money — usually between 5-10% of the construction budget.
The Building
With the groundwork laid, it’s time to start bringing your home to life.
Hammer & Hand is a traditional builder. We budget, schedule, and build homes that will last. We advise on construction best practices, something that makes us unique among other home builders.
Our expertise in energy performance and modern building science ensures that your house will deliver superior comfort, health, and efficiency for years to come.
In our experience, the cost to build a house in Portland over the last few years has typically started in the range of $450 to $650 per square foot while the cost to build a house in Seattle has started closer to $650+ per square foot.
High performance or passive houses would increase these ranges. Please see our article on those costs here.
Please bear in mind that these are general starting estimates and do not include design fees, finishes, permitting, taxes, etc. A project supervisor can provide you with a more specific and comprehensive estimate once you provide plans from your design team.
Current Real Estate Trends
The cost to build a house in Portland, Seattle, or any region of the Pacific Northwest will depend highly on current real estate trends — with high demand and low supply comes high costs.
At the time of this writing, real estate prices have spiked dramatically in the region. Particularly in Portland, where an influx of aspiring homeowners and a scarcity of homes sent the median sale price up over 7% in 2021. Finding empty lots on which to build is increasingly difficult, and property in almost every neighborhood is significantly more expensive than even 2 years ago.
When planning your home building budget, it is essential to take current real estate trends into account to avoid any unpleasant surprises.
“Soft” Costs
Soft costs are expenses that may continue after a project is completed. They typically include additional fees incurred during the construction of your home — aside from labor and building materials.
Here are some examples of soft costs:
- Architecture
- Design
- Engineering
- Accounting
- Permits
- Taxes
- Fees related to the upkeep of your property after the home is built (i.e., HOA fees)
Sample Estimate of the Cost to Build a House in Seattle or Portland
Let’s put it all together.
As an example, say we build a 2,500 square foot house in Portland at $500 per square foot. The base cost for the home is $1,250,000.
Next, factor in approximately 15% for the architect and other “soft costs” — in this example, $150,00. Add the new total ($1,400,000) to the cost for the land/site and it becomes clear that the cost of building a home can increase quickly. Please bear in mind that each project is unique — in a unique location, with unique goals and challenges — and as such it will come with its own unique costs.
At Hammer & Hand, we want you to feel confident that your money is being spent wisely. We operate with unparalleled transparency, accounting for every dollar spent — from labor costs down to each box of nails. You’ll receive a billing summary with every statement so that you can see exactly where your money is going.
We pride ourselves on identifying ways to make significant changes to the construction budget without negatively impacting the project goals. Our job is to find ways to best achieve the vision for your project while minimizing cost. We are both proactive and efficient in updating pricing based on new options or selections made by you and the project team.
Hammer & Hand: Portland & Seattle’s Top Choice for Residential Construction
The cost to build a home in Seattle or Portland isn’t the only factor to consider when making such a large investment. Hiring the right builders for the job is essential to bringing the vision of your new house to life.
Hammer & Hand’s team has been building residential properties for over two decades. We have a reputation for building houses with precision, thoughtfulness, and the highest quality materials.
We’ve hired the best craftspeople and project managers in the business to ensure your home build is nothing less than you’ve envisioned. Contact us today to learn how we can help you build your next home in the Pacific Northwest.
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