What Impacts the Cost and Length of New Home Construction?

Every Ocean County, NJ construction project is different and it is important to have an accurate estimate of how much the project will cost and the amount of time it will take from start to finish. In 2020, the New Jersey real estate market demand is outrageously high everywhere due to record low inventory and interest rates. Buyers are faced with lengthy searches, bidding wars and escalating real estate prices. The process of estimating new home construction is generally complex – here are the factors that contribute to the cost and length of new home construction.

Building Materials Availability

The cost of construction will be lower if the building materials are reasonably priced, in stock and stored within easy reach of the site.

You are likely to spend more money if the building materials are being outsourced from far away from the construction site. The cost of the construction materials impacts the project when estimating the overall cost. This includes the base cost of materials, shipping charges, and any applicable taxes. If the building materials are more expensive than expected to purchase, the price could exceed your budget and you may experience delays in financing. You can read about How to Choose a House Plan When Building a New Home? HERE.

Condition of the Site

The cost of constructing a new home can increase or decrease based on the condition of the construction site. Some of the conditions that will influence cost include poor soil conditions, conflicting utilities, wetlands, buried storage tanks, and overhead lines. You might also encounter the possibility of eviction if the construction site is home to endangered species, stream or river crossing or an archeological site. Sometimes land will need to be cleared of brush or vegetation which can increase the cost of sitework. Using heavy machinery and equipment to dig out stones and wide trenches when building the foundation translates to high costs and can add significant time to the project.

Cost of Labor

The amount of money charged by the contracting company or construction workers may vary depending on the type of work to be done, the type of building or structure, and skill level of the laborers. Labor costs will be higher in urban areas than in rural areas because of high demand and competitive pricing in the market. For long projects that take several months to complete, be sure to consider the probable variation in wage rates when estimating the total project cost.

Property Location

A home located in an urban areas or that is placed close to major highway access may be priced at a higher value compared to homes in rural areas or remote suburbs. Property location is usually based on lifestyle preferences or necessity. Proximity to local schools and employment opportunities are some of the topmost priorities for most employment-age buyers. Other social amenities such as shopping centers and recreational centers are highly valued by most younger buyers. All these factors play a significant role in the overall price of a new home as it has a positive impact on the quality of life of a homebuyer.

Project Schedule

The cost estimate of new home construction is greatly influenced by the time taken by the contractor to complete the job. Unexpected delays such as change orders, weather condition or building material supply shortages will increase labor costs. These indirect costs contribute to the price and length of time it takes to complete the new home construction.

Choice of Architect

Professional architects are able to conceive of incredible structures that fulfill the dreams and wishes of a homeowner. They must also ensuring that every part of the building is constructed according to their specifications and plans. Reliable and experienced architects do not cut corners in an attempt to lower the costs of construction because their reputation is on the line and they are concerned with the safety and satisfaction of their clients. Hiring a reputable professional architect can save money by avoiding costly mistakes and will allow you to allocate resources elsewhere to enhance the project and the property. They follow the construction process meticulously to ensure everything is done perfectly.

In addition to what has been described, the overall pricing of new home construction can be impacted by unexpected factors that may be beyond your control. Before you start your project, it is important to have a solid plan based on your presumed budget, a reliable cost estimate and the work of a professional architect. Lastly, don’t compromise on the quality of your building materials, as this can have a negative impact on the value of your property and its durability.


  • Michelle Garofalo

    Michelle Garofalo is the guiding force behind MSC Enterprises, LLC, a prominent custom home builder and real estate developer in Monmouth County and Ocean County, New Jersey. With over 25 years in real estate development, her expertise extends from a successful career in the solar industry, where she managed over 75MW of projects. Co-founding Infiniti Energy, Michelle now oversees day-to-day operations and leads business development, ensuring a seamless journey for clients. Her meticulous approach and commitment to excellence are reflected in MSC's residential and commercial properties, known for their quality, durability, and energy efficiency.

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