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Cheapest Ways To Build A House: 10 Tips For Affordable Home Building

Erica Gellerman5-minute read

May 13, 2022


In many parts of the country, the lack of affordable housing is frustrating home buyers. If that’s your situation, instead of trying to compete in red-hot housing markets, you may be looking for the cheapest way to build a house. There are a lot of different options available to take advantage of and building a budget-friendly home may be a doable project you want to take on.

Here are some tips to help you build your budget-friendly home:

1. Simplify Your Home’s Design

The cheapest way to build a home is to design a simple box. Sticking to a square or rectangle makes the building and design simple. Generally speaking, building up is cheaper than building a sprawling one-story home, so you may want to consider planning for a multiple-story home if you need more space.

If you’re worried a box-style home isn’t going to be attractive, consider that you can make the exterior more interesting with landscaping, shutters, lighting and other decor options that don’t cost a lot.

Another part of the home’s design to consider is the roof. Believe it or not, there are many different roofing designs and they can affect the price of your home. The simpler the roofing design, the less expensive it’ll be to build a home.

For example, according to RemodelingImage.com, the installation for a (nearly) flat roof on a 1,500-square-foot home costs $6,000 – $15,000 on average. For a gable roof, the typical, two-pitch roof, the installation cost is $12,000 – $18,000, and up to $25,000 when you factor in the cost for asphalt shingles. An even more complex roof, the Mansard roof – with a flat rooftop and multiple pitches – can have installation costs of $20,000 – $50,000 on average.

Of course, costs will depend on a number of factors, including the size of the home/roof, the materials used, the number of pitches and the steepness and length of the slopes. Dormers can also increase the price.

2. Try A Tiny Home

There’s a reason tiny houses are increasing in popularity: they cost less to build and can be built on wheels for people who may wish to move in the future. You don’t necessarily need to buy a tiny home to get the cost benefits of a smaller home.

Many of your materials and labor is going to be priced per square foot. Build a 2,000-square-foot home rather than a 3,000-square-foot home, and you’re going to save yourself money. Decide to build a tiny home, which by definition are under 400 square feet, and you’re going to save yourself a whole bunch of money. The average cost to build a tiny home is about $20,000 – $30,000 for materials. Depending on whether your tiny home is mobile or stationary, you may also have to purchase land to build it on. According to the USDA, that’s about $3,160 per acre for rural land, on average in 2020. However, the cost of land will depend on the state you plan to live, certain features, like lakes, and the land’s proximity to metropolitan areas. It's also important to note that you typically can't get a mortgage for a tiny home, so you'll need to look at alternative financing options.

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3. Hire An Experienced Home Builder

If you’re working with a home builder, hire an experienced one. While an experienced home builder might cost more than one with little to no experience, you’ll likely make up the cost during the building process. An experienced builder can help you figure out where to spend and where to save. They’ll probably have creative money-saving ideas. And they can help you avoid problems before they arise since they’ve likely had a lot of experience navigating problems in their career.

4. Save Costs By Becoming A General Contractor

If you have building experience or a large network of skilled labor, you may decide to act as your own contractor and manage the home building process yourself. You may still want to work with an architect or download plans for a home from the internet.

Acting as your own contractor is one way that you can save on costs. If you’re able to do a lot of the work yourself, this can be one of the cheapest ways to build a house.

That said, some of the work should still be done by subcontractors if this is your first time building a house. Correcting your mistakes can be costly and time-consuming, so if you’re not sure of your skills, hiring a professional can save more money in the long run.

5. Get Your Design Plans Approved

Waiting and redesigning your home can cost a lot. For example, if you don’t get all of the necessary permits in time, you will spend a lot of time (and money) waiting for permits to be approved. Any changes that you make to your building plan during the construction process can also add significantly to the total cost of the build. That’s why it’s important to get your plans approved early in the planning process before you start building.

Plus, if you start work without getting them approved first by your city or county, you risk being charged a hefty fine (or worse, having to redo some of your already completed work).

6. Budget, Plan And Price Out All Items

Don’t wait until the end to be surprised by the cost. Create a budget and price out everything that you expect to spend on the home. While you may not have a perfect estimate right from the beginning, starting to get a handle on the costs can help you throughout the entire building process.

Whenever prices change or a cost gets added, make sure you add it to your budget. It should be a live document that changes as your plans change, so you always know where you are in your spending and you don’t run the risk of running out of money.

Take the first step toward the right mortgage.

Apply online for expert recommendations with real interest rates and payments.

7. Choose Building Materials Wisely

Different types of building materials will have different costs. Choosing cost-effective materials can help keep the project affordable. Here are a few to consider.

Reclaimed Materials

While using reclaimed materials like old barn doors or wood in your home build is trendy, there’s a practical reason it’s so popular: it saves money. Look for reclaimed doors, wood floors, windows and decorative items.

Not sure where to find reclaimed materials? Check Craigslist, Planet Reuse, a salvage store or find a home that is currently being torn down and see if you can salvage any of its old materials.

Prefab Panels

Prefabricated panels are wall panels that are custom-built inside a factory and shipped to the build site. By having the walls built indoors and shipped to the site ready to install, they can cut down on construction and framing labor time. This can help you save money because you aren’t paying for the extra labor to build and frame the walls.

Precast Concrete

Just like prefab panels, precast concrete is concrete that’s poured into a reusable mold, cured indoors, then shipped to the build site. On average, precast concrete costs less than on-site pouring because it cuts down on on-site labor and can help prevent delays due to weather.

Shipping Containers

This alternative housing idea uses old shipping containers for the structure of the home. Since they structure is already intact, this type of housing can help you save money on construction costs. Of course, you’ll need to consider the modifications you’ll need to make to the container to turn it into livable space and costs go up if you use more than one container.


Cob is a mixture of straw, clay and subsoil. This earthen material is so thick, it provides energy-efficient, thermal benefits. And since most of the ingredients for cob can be found on-site for free, you can save a good amount of money on material costs. Cob is also known to last hundreds of years and only requires a new layer when it eventually needs to be fixed.

8. Buy Materials At A Discount

Materials are going to be one of your biggest costs (if not the biggest) of the job. So if you can cut your materials budget, you’ll significantly reduce cost to build your home. When you begin shopping, ask each supplier if they offer a builder’s discount. Yes, it’s OK to ask. You may not be purchasing materials in a large enough quantity to qualify, but it doesn’t hurt to ask.

If you can’t qualify for a discount on your materials, you might ask your contractor to purchase the items for you using their discount. Depending on your relationship, they may not charge a markup to do that for you.

9. Add Energy-Efficient Home Features For Rebates And Taxes

Everyone seems to be going green when building and there’s a cost-saving reason for that. Using energy-efficient materials, including better insulation and high-efficiency windows, may cost more upfront, but can ultimately save money for homeowners over the years. Consider solar or wind energy as a power source, but check to make sure that these are available in your area and right for your particular piece of land.

You might also be able to qualify for rebates and tax breaks for building certain energy-efficient elements into your home. Check with EnergyStar.gov to search for local, state, and federal rebates for your energy projects.

10. DIY As Much As You Can

Are there certain finishes in your home you’d love to have, but you can’t afford? It’s time to watch some videos and give it a try yourself. Going the DIY route can save you money, especially when it comes to things like painting or laying flooring.

But not all work that you DIY will be a money saver. If you don’t know how to do some of the big jobs, like plumbing or electrical, it may cost you more to have someone fix your mistakes down the road.


Home building can be a financially viable alternative for people who are wondering if they should buy a home. However, there are many advantages to taking the more straightforward path of buying a preexisting dwelling. Although you might miss out on opportunities to save, you’ll also be facing less unpredictability regarding your total costs. Before deciding to build, you’ll likely want to learn more about the process of buying a home in order to understand your options. A good place to start is to learn more about preapproval.

Take the first step toward the right mortgage.

Apply online for expert recommendations with real interest rates and payments.

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Erica Gellerman

Erica Gellerman is a CPA, MBA, personal finance writer, and founder of The Worth Project. Her work has been featured on Forbes, Money, Business Insider, The Everygirl, The Everymom and more.