When it comes to building a new home in Michigan, you should first do some research to learn more about the building process and the costs involved. Too often, eager homebuyers are quick to consider just the costs of land and construction. In the process, they may miss some of the key steps in the process or larger expenses that sometimes show up as hidden fees, such as permits and installation costs.
According to HomeAdvisor, the average cost to build a new home in Michigan is between $225,000 and $265,000. These figures offer an estimate, and your overall cost will vary by location, materials and labor costs and personal preferences.
If you’re considering building a home in Michigan, here is a breakdown of what you should expect throughout the process.
Climate Considerations
Mostly due to the state’s proximity to the Great Lakes, Michigan typically offers moderate summers and icy winters. Waterfront breezes cool the land in the summer and may add moisture to the air. Residents should expect long, frigid winters with a lot of snow and ice. If snowboarding and skiing are your thing, then Michigan is the perfect place to call home.
Because of the range of climates, you should make sure when building your home that you weatherproof it for the moist air of summer and the ice storms of winter. Weather strips, extra insulation in the walls and around the plumbing, and a quality HVAC system are necessary for ensuring a safe and healthy Michigan home during all seasons.
How Much Does It Cost to Build a Home in Michigan?
In Michigan, the building opportunity depends on the season. If several feet of snow are on the ground, the building process may be delayed. It is often best to plan for spring to begin new construction. In any case, a standard 2,000-square-foot home in Michigan may take about six months to complete from breaking ground to finishing touches.
Here are the key steps to expect when building a new home in Michigan.
Building a new home in Michigan in 2024 involves various costs that can add up significantly. On average, it costs between $216,780 and $366,780 to build a house in Michigan, with the price per square foot ranging from $122.50 to $150, according to Houzeo.
Land Costs
The cost of land in Michigan varies widely depending on location, but on average, you can expect to pay around $6,400 per acre, according to HomeLight. However, this price can fluctuate significantly based on factors such as proximity to urban areas, water views, and lot size.
Permits and Paperwork
Obtaining necessary permits is a crucial step in the building process. In Michigan, building permits typically cost around $5,000, according to Houzeo. Additional permits are required for specific systems:
Electrical permit: $10 - $500
Mechanical permit: $50 - $100
Plumbing permit: $50 - $500
HVAC permit: $250 - $400
Site Preparation
Site preparation, excluding excavation and basic landscaping, can cost between $1,500 and $3,000. This phase is essential for creating a stable foundation for your new home.
Framing
Framing is a significant part of the construction process, typically costing between $14,000 and $32,000. For a 2,000 square foot house, framing materials run between $3 and $6 per square foot, according to Today's Homeowner.
Roofing
Roofing costs in Michigan range from $6,550 to $11,900, according to HomeLight. The price can vary depending on the materials used, with asphalt shingles being one of the more affordable options.
Labor Costs
Today's Homeowner states that labor comprises about 40% of the total cost of building a house in Michigan. This translates to approximately $28 to $60 per square foot or $56,000 to $120,000 of the average cost. This includes various professionals such as carpenters, electricians, and plumbers, each with their own hourly rates.
Major Systems
Installing major systems is a crucial part of the building process HomeLight says to expect these prices as estimates:
HVAC system: Approximately $10,000
Plumbing system: $2,280 to $5,120
Electrical system: $601 to $2,582
Interior Finishes
Interior finishing is often one of the most expensive parts of building a home, costing between $42,000 and $175,000, according to HomeLight. This includes elements such as flooring, drywall, painting, and fixtures. The cost can vary significantly based on the quality of materials and level of customization chosen.
While building a new home in Michigan can be a significant investment, it allows for customization and potentially newer, more efficient systems compared to buying an existing home. However, it's important to note that construction costs have increased in recent years, and unexpected expenses can arise during the building process.
Helpful Tips for Building in Michigan
Finally, here are a few tips and tricks for building your dream Michigan home.
Financing
These numbers may feel overwhelming at first glance. However, Michigan offers two different types of financing for your new home construction. One-time-close construction loans offer the reassurance of one-time approval for a fixed-rate mortgage, allowing you to lock in an interest rate before breaking ground on construction.
Two-time-close construction loans, also referred to as “construction-to-permanent loans,” offer more flexibility over the construction period. Homeowners will start with a construction loan that may be distributed in smaller amounts gradually during phases of the building process, then eventually the full amount can be refinanced into a permanent mortgage upon completion of the project.
Closing Cost Incentives
Almost every state or region offers homebuying incentives for first-time and repeat buyers. These are usually in the form of financial assistance to aid in closing costs or lower interest rates. Make sure to research Michigan homebuyer assistance programs for more information that could save you a chunk of change in the long term.
Build Your Michigan Home
From purchasing land to painting the front door, hopefully these steps will provide an outline for building your new dream home in Michigan. With a little bit of research, many discussions with your contractor and hopefully a lot of excitement, you’ll find any stresses about the overall construction melting away, adding an ease to the process that will welcome you home.
Erin Nicks
Erin Nicks has written for various publications for more than 20 years. She has covered new home construction for industry-leading websites and publications, such as Livabl, ARCHITECT, Multifamily Executive, and Builder Magazine.