--- title: 10 States Where It's Now Cheaper to Build Your Own House Than Buy One description: In South Atlantic states and out West, building a home is often a more cost-friendly option than buying, a new report finds. authors: - name: Pete Grieve role: Lead News Reporter url: https://money.com/author/pete-grieve/ bio: Pete Grieve is a personal finance reporter at Money who frequently covers news stories about housing topics including home buying, mortgage rates and homeowners insurance. education: University of Chicago, BA Political Science at_money_since: 2022 articles: 598 covers: - Housing - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Professional Services - Retirement - Shopping - Taxes social: - https://twitter.com/pete_grieve - https://linkedin.com/in/pete-grieve-b5aa02138 - https://www.facebook.com/petegrieve4 published: '2023-02-23T19:58:25.000Z' modified: '2024-01-10T14:36:41.000Z' section: Housing tags: - News word_count: 467 canonical: https://money.com/build-vs-buy-house-costs/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Partially built house](https://img.money.com/2023/02/News-Cheaper-Build-Home.jpg) It’s now cheaper to build a home than it is to [buy an existing one](https://money.com/is-buying-a-house-a-good-investment/) in more than a third of U.S. states. The savings vary significantly depending on the market. Building a typical home costs nearly $500,000 less than buying in Hawaii, the state where a [new report](https://www.storagecafe.com/blog/is-it-cheaper-to-build-or-buy-a-house-in-the-us/) from storage unit listing service StorageCafe says this method provides the most cost advantages. On the other hand, in states like Pennsylvania and Ohio, it costs about $180,000 more to build than to [buy](https://money.com/how-to-buy-your-first-home/) an existing home. ## What the research says Due to the steep rise in home prices over the past few years and the limited inventory of existing homes for sale, building may be the more attractive option for a growing number of Americans. Building from scratch generally makes the most sense in areas where [home prices](https://money.com/cities-home-prices-forecast-fall-2023/) are high. The states where it's best to build a home tend to be the West and the South Atlantic, while in the Midwest, you're better off buying an existing home, according to the report. The 10 [best states](https://money.com/best-places-to-live/) for building based on the difference in cost compared to [buying](https://money.com/its-a-buyers-market-so-why-arent-more-people-buying-homes-right-now/) are: - Hawaii (where building costs $494,000 less than buying) - California ($205,000) - Colorado ($108,000) - Utah ($97,000) - Virginia ($96,000) - Delaware ($96,000) - Maryland ($95,000) - Montana ($84,000) - Florida ($76,000) - Idaho ($70,000) ## Keep in mind It's normally cheaper to [buy](https://money.com/how-to-buy-a-house/) an existing house, mainly because construction is expensive, especially since labor and material costs have increased with inflation. Here are the 10 worst states for building, meaning the median-priced home costs less than building a similar new home: - Pennsylvania (where building costs $183,000 more than buying) - Ohio ($178,000) - Illinois ($166,000) - Maine ($164,000) - Iowa ($161,000) - Missouri ($155,000) - Michigan ($153,000) - South Dakota ($144,000) - Indiana ($142,000) - West Virginia ($133,000) The researchers calculated [building costs](https://money.com/how-much-house-can-i-afford/) by totaling the prices of typical size residential lots, regional construction costs for a median build and other expenses for permits, surveys and so on. The home buying costs in the study are based on median listing prices on real estate website Point2 Homes. ## Bottom line A buyer's personal preference for new versus old construction is central to the decision to build or buy. And not every neighborhood has lots for sale that you can build on, so if you want to build your next home, you may need to be flexible about living in a less developed area. But if you're in the market for a home in an area where building is cheap, you might have a more affordable opportunity to buy a lot and design your next house instead of shopping existing real estate. ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/build-vs-buy-house-costs/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Housing", "item": "https://money.com/housing/" }, { "@type": "ListItem", "position": 3, "name": "Home Prices", "item": "https://money.com/home-prices/" }, { "@type": "ListItem", "position": 4, "name": "10 States Where It's Now Cheaper to Build Your Own House Than Buy One" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/build-vs-buy-house-costs/#webpage", "url": "https://money.com/build-vs-buy-house-costs/", "name": "10 States Where It's Now Cheaper to Build Your Own House Than Buy One", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2023-02-23T19:58:25.000Z", "mainEntity": { "@id": "https://money.com/build-vs-buy-house-costs/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/build-vs-buy-house-costs/#breadcrumb" }, "dateModified": "2024-01-10T14:36:41.000Z" }, { "@type": "NewsArticle", "headline": "10 States Where It's Now Cheaper to Build Your Own House Than Buy One", "articleSection": "Housing", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2023/02/News-Cheaper-Build-Home.jpg", "width": 2880, "height": 1920, "caption": "News-Cheaper-Build-Home" } ], "author": [ { "@type": "Person", "name": "Pete Grieve", "url": "https://money.com/author/pete-grieve/", "@id": "https://money.com/author/pete-grieve/#author", "description": "Pete Grieve is a personal finance reporter at Money who frequently covers news stories about housing topics including home buying, mortgage rates and homeowners insurance.", "image": "https://img.money.com/2023/02/peter.png?w=350&h=430&crop=1", "email": "peter.grieve@money.com", "jobTitle": "Lead News Reporter", "alumniOf": "University of Chicago, BA Political Science", "sameAs": [ "https://twitter.com/pete_grieve", "https://linkedin.com/in/pete-grieve-b5aa02138", "https://www.facebook.com/petegrieve4" ], "worksFor": { "@id": "https://money.com/#organization" } } ], "publisher": "https://money.com/#organization", "datePublished": "2023-02-23T19:58:25.000Z", "description": "In South Atlantic states and out West, building a home is often a more cost-friendly option than buying, a new report finds.", "abstract": "In South Atlantic states and out West, building a home is often a more cost-friendly option than buying, a new report finds.", "@id": "https://money.com/build-vs-buy-house-costs/", "inLanguage": "en-US", "dateModified": "2024-01-10T14:36:41.000Z", "wordCount": 467, "keywords": [ "News" ], "about": [ { "@type": "Thing", "name": "Housing in the United States", "sameAs": [ "https://en.wikipedia.org/wiki/Housing_in_the_United_States" ] }, { "@type": "Thing", "name": "Real estate economics", "sameAs": [ "https://en.wikipedia.org/wiki/Real_estate_economics" ] }, { "@type": "Thing", "name": "Housing market", "sameAs": [ "https://en.wikipedia.org/wiki/Housing_market" ] } ] } ] } ```