Anywhere between $300,000 to $600,000: that’s the cost to build a 1,500-square-foot home in New Jersey.
Thinking of expanding? Weighing your options between building versus buying a home?
We understand.
These days, it’s not always so simple to find reliable, up-to-date information on the cost of homes.
With that being said, we’d like to help you out and give you our estimates of the average cost of building a 1,500-square-foot home to make your life a little easier.
So, in this article, we’ll be talking about the average cost to build a 1,500 square foot home in New Jersey, so you can make more informed decisions for your dream home.
In this article, we’ll cover the following topics:
- The process of calculating the average cost to build a 1,500-square-foot home
- Breaking down the cost by square foot
- The most affordable states to build a house
- The median and average home build cost in the United States
- Non-construction and construction-related costs to consider when building a home
- Loan and mortgage information for home-building
- A 4-step process to build your home — that is, once you’re ready to do so
- Frequently asked questions (FAQ) about building homes
Calculating the average cost to build a home
We used information from the National Association of Home Builders (NAHB) to calculate the cost of building a new, single-family home. This cost includes the cost of land.
The average cost is about $665,000 according to the NAHB survey (Lynch, 2025). This number includes the price of the land on which the home is built.
With that being said, the median cost for a new single-family home in the U.S. was north of $400,000 in early 2025.
As such, the cost of building a house depends on a few different factors, such as:
- The size of the home
- The location of the build
- The cost of labor and materials
- Current real estate trends
- The cost of living in the area
Therefore, the cost of a single-family two to three-bedroom home isn’t always a straightforward answer. So, let’s endeavor to answer this question by looking at the cost of building a home in another way — the cost of the build per square foot.
Breaking down the cost by square foot
As of 2025, the average cost to build a house for a non-custom, building-grade home is $159 per square foot. A custom, luxury home can cost up to $550 per square foot.
In essence, the average cost to build a 1,500-square-foot home is about $150,000 to $300,000. But, this price doesn’t include ancillary costs — like the cost of the land, the cost of preparing the land, and where the house will be built.
As such, expect double the price for a 3,000-square-foot home.
But before you nail down the size and cost you have in mind, you’ll want to think about the space that you need for your home. You might consider the assets you’ll keep in your home and those that will be discarded.
By and large, the answers to these questions — and the geographical municipality in which your home is built — will give you a ballpark estimate of the cost of your new home build.
Most affordable states to build a house
A great deal of a home’s price is based on its location. Building a house in a desirable neighborhood can sometimes amp up the price of the building.
In other words, the cost of living can also impact the cost of the build. Higher taxes, more regulations on home building, the cost of doing business, the cost of materials, and other factors can affect the final sticker price.
Note that these factors fluctuate from location to location.
So, if you’re looking to build in a state with a low cost of living, we recommend the Midwest or South. The east and west coasts tend to be more expensive.
The average cost to build a 2,000-square-foot home tends to be $310,000 to $365,000 in states west of Colorado. In contrast, the cost to build a 2,000-square-foot home in the Midwest can range from $300,000 to $380,000.
In southern states, homes tend to cost $287,000 to $310,000, and in the northeast, expect a new build to cost $322,000 to $422,000.
The West tends to be cheaper to build, but the cost of living is higher, which can make the cost of upkeep higher. As you’re considering the average cost of building a single-family home, keep in mind location, as well as the cost of the land (and preparing the land).
Land preparation and acquisition can add extra dollars to the base price of building a custom home.
With that being said, let’s take a look at the average and median price of building a square foot home for a more accurate estimate of the price across the United States.
Median and average cost to build a home
According to the National Association of Home Builders (NAHB, 2025), the average cost to build a new, single-family home — which includes the cost of the land — is $665,298. While that number may sound pretty high for the cost of living here in New Jersey, consider the following.
The same survey found that the median price for construction of a home was about $428,215, a number that’s more palatable and on par with the New Jersey market.
In other words, the breakdown of the average costs of a new, single-family house depends on many factors. Factors, such as home size, location, labor and material choices, and current real estate trends all affect the regional cost of constructing a standard home.
With all the different factors listed above, providing a baseline number and one-size-fits-all answer to the question, “How much does building a house cost?” is challenging.
But we’re not totally out of luck. We can break down the cost to build a home by its non-construction and construction-related costs.
Non-construction-related costs to consider
Non-construction costs are costs that affect the overall cost of the home that aren’t related to the actual building of the home. So, for example, if we go back to the study we mentioned from the NAHB earlier, the total construction cost of the single-family home was $428,215.
Nevertheless, the total cost of the home after construction concluded was $665,298.
What gives? Why the difference?
The difference lies in:
- The cost of the land
- General expenses
- Home financing costs
- Sales commissions provided to the real estate team
- The compensation that the builder takes home.
These non-construction costs account for the difference between the $665,298 and $428,215 price. You’ll want to budget for more than just the cost of construction when deciding on your new dream home.
Let’s unpack each of the items in the bullet points above in greater detail.
The finished plot of land
The plot of land includes both the land your house will reside on, as well as any utility systems that you might use (think: water, gas, electricity, and sewage systems).
In the study above, the cost of the finished lot for the single-family home mentioned was $91,057.
Overhead and administrative expenses (for your home builders)
Overhead expenses include expenses such as administrative fees, legal fees, employee benefit expenses, and insurance. In the study, the cost of overhead and general expenses was $38,248.
Costs to finance the build
Most people don’t pay cash to cover the cost of building a house (though some do, and they’re very lucky to do so!).
Instead, most prospective homeowners use lenders and other financial institutions to help cover closing and construction costs.
Financing constitutes a smaller percentage of the overall cost to build a house. In the case of the study mentioned earlier, the cost to finance the home was $10,220.
Sales commissions and profits
What’s more, a real estate team makes their living off the commissions and other sales. As such, you’ll have to pay a sales commission to a real estate team as part of construction costs.
And, since builders also earn a profit, you can expect some of the cost of the new build to go towards paying for their commissions.
The cost of sales commission was $18,995 for the study mentioned above.
Construction costs
Once non-construction costs are accounted for, the bulk of the cost of building a new home comes down to, of course, the actual construction of the home.
Home construction costs make up the lion’s share of the expenses of building a home. With that being said, when you’re building a house, you’ll want to budget for the following construction costs:
- Construction work on site
- The cost of building the foundation
- Framing costs
- The cost of interior and exterior finishes
- Major systems infrastructure
- Potential unforeseen changes and costs
We’ll explain what’s included in each of these costs in the next few sections.
Construction work on site
Site construction includes projects like building permits and fees, home inspections, architectural drawings, and engineering. In other words, site construction work is any work that’s needed before any people or equipment can start tearing things apart.
First, you need an architect or draftsperson to draw up the plans for your new build. Then, your building team will need to procure permits and conduct inspections before your builder and contracting team can begin construction.
The cost of site work from our survey above was $32,719.
The cost of building the foundation
The foundation: it’s all the dirt that’s dug up in preparation to lay the cement that supports your home. Building the foundation refers to excavating beneath the surface of the home, pouring concrete, and building retaining walls.
Especially in New Jersey, many homeowners design and build their homes to include basements. If you elect to build your home with a basement, expect the cost of laying the foundation to be higher (because builders have to dig deeper and pour more concrete).
The cost of building the foundation from the study was $44,748.
Costs for framing
The frame is the structure that holds the house in place. Framers are workers who nail together the wood and create the overall frame and structure of the house.
Sourcing the wood, delivering it to the house, unloading it, and assembling the wood can take time, cost money, and require a great deal of effort.
The cost to frame a house is $49,763, according to the NAHB study mentioned earlier in this article.
The cost of exterior finishes
In addition to house framing, exterior finishes are also a part of the final quoted price. Examples of exterior finishes include doors, windows, roofing, siding, brick inlays, outdoor tiling, and more.
Exterior finishes accounted for $57,510 of the total cost of building a home, according to the NAHB survey mentioned above.
The cost of interior finishes
Interior finishes make up the bulk of a home’s value and price tag. Interior finishes include everything from drywalling, trim, painting, lighting, cabinets, insulation, countertops, appliances, and flooring.
In the study mentioned above, interior finishes for a single-family home can cost $103,391.
The infrastructure for major systems
A home’s value can also be determined by the sturdiness of its internal systems. Major systems — like plumbing, electricity, and HVAC — are complicated industrial systems that include tons of pipes, wires, and ducts.
We definitely discourage skimping on costs related to your home’s major systems, as your smart home HVAC and sturdy plumbing systems are what keep you cool, calm, and comfortable year-round.
Skip on investing in your major systems, and you could find yourself in deep trouble, comfort-wise.
From the study above, the installation of major-system rough-ins was $82,319.
Unforeseen costs and final details
Like any major project involving multiple deadlines, individuals, and tasks, last-minute changes happen. Though we try to plan and imagine every possible angle of a project, changes occur from time to time.
When they do occur, we always recommend having a reserve of funds ready to account for these changes. Whether that means final changes to improve your curb appeal with landscaping, decks, patios, porches, and driveways — or you’re budgeting for cleaning up after the home has been built, the final steps and extra costs can add up.
According to the NAHB survey mentioned earlier in the article, the total cost to clean up, finalize, and account for changes in the plan was $36,545.
Loan and mortgage information for home-building
Whew! That was a lot.
But, knowing how much cabinets cost and what makes up the construction cost per square foot is essential to making a solid plan to finance your new home.
While most people don’t have the upfront cash to pay for their homes, people often instead use construction loans. A construction loan covers the time needed to build your home.
A construction loan comes with a repayment term of one year, and acquiring a construction loan is part of the mortgage process. Since both mortgage and construction loans share similar processes, a construction loan and mortgage are often part of the same deal made with the same lending institution.
Once your new home is built, your construction loan and all payments you made switch over to a mortgage that helps you pay for both the land and home you purchased.
As a general rule of thumb, your monthly mortgage payment, which includes not just the mortgage but also homeowner’s insurance, property taxes, and other fees, should be less than 25% of your monthly take-home pay.
But at the end of the day, you have to do what’s comfortable for you.
As such, we have long-standing relationships with leading lending institutions, banks, and financial partners in the New Jersey area. If you’re curious about financing, check out our financing page to learn how much you can borrow for your new home project.
Did you know?
Did you know that New Jersey ranks in the top three states where homes are selling the fastest? If you’re looking to buy a house, you couldn’t have picked a better time or place.
See if your state lands on the grid here with our top 10 states of homes that are selling the fastest.
Before you build your new home, choose your builder wisely
The answer to how much it costs to build a 1,500-square-foot home isn’t always clear-cut. According to a Statista.com (2025) survey, single-family houses ranged from as little as $167,000 in West Virginia to $981,000 in Hawaii.
While the national average cost of a single-family home varies according to labor costs, floorplans, fixtures, countertops, and a host of other variables, the average price falls somewhere between West Virginia and Hawaii’s average home price.
Whether you decide to buy an existing home or build one from the ground up, building a house isn’t just about dollar signs.
Building a home is about who you choose to help you build.
As such, we always recommend having a high-quality, timely, and responsible building contractor. Your general contractor will determine the cadence, quality, and support you receive with your new build.
What’s more, if you have a budget in mind, they’ll make sure the average total costs stay within your budget. No surprises here.
If you’re curious what else your general contractor can do for you — or if you’re ready to learn more about what we do as general building contractors — don’t hesitate to reach out to us.
Our team has more than 20 years of experience in the real estate and home construction industry, and we’d be happy to help you with all your home-buying needs.
Until then, we wish you all the best on the journey ahead!
Frequently asked questions (FAQ) about home construction costs
1. What are the pros and cons of building versus buying a new home?
The advantages of building a new house are that you have endless opportunities to customize to your heart’s desire, build exactly what you had in mind, and enjoy increased home value. The downside is that the building process can take several months.
The pros of buying a new home are you can ensure quality material and quality craftsmanship in the new build. The downsides are that you won’t necessarily have a say in the building process or the customization of the entire house from start to finish.
2. Which homes are the fastest and cheapest to build?
In general, one-story homes tend to be most cost-effective and expeditious to build. For example, the average price range of ranch-style homes, modular homes, and tiny homes tend to be less expensive than multi-story homes.
With that being said, the value of a home also depends on its floor plan and how much appliances cost, among other factors.
3. What are the benefits of using a design-and-build contractor?
A contractor who both designs and builds can ensure the entire building and design process is housed under one roof. Having all information, processes, and subcontractors under one roof ensures a more seamless finish and consistent communication before, during, and after your dream home is complete.
