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

Mar 15, 2024



In many parts of the country, the lack of affordable housing can be frustrating for home buyers. Instead of trying to compete in red-hot housing markets, you may be looking for the cheapest way to build a house. With so many options to consider, building a budget-friendly home may be a doable project you want to take on.

Read on to learn some of the cheapest ways to build a house.

1. Simplify Your Home’s Design

The cheapest way to build a home is to design a simple floor plan. Sticking to a square or rectangular floor plan makes the building and design more straightforward. Plus, building up is generally cheaper than building a sprawling one-story home. You may want to consider planning for a multiple-story home if you need more space.

Roofing Costs

Another part of the home’s design to consider is the roof. The total cost of a new roof depends on factors like the square footage of the house, the materials used, the number of pitches, the steepness of the slopes and length of the slopes. The simpler the roofing design, the less expensive it’ll be to build your own house.

According to Rocket HomesSM, installing a new roof can cost anywhere from $5,500 to $11,000. Asphalt shingles, which are a more budget-friendly roofing option, can cost closer to $2,000. If you’re looking for durability, roofing materials like slate or stone can cost an average of $22,700 or more.

Shop around to compare the costs of different roofing materials and styles before installing the best option for you.

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2. Try A Tiny Home

Tiny houses are increasing in popularity, and for good reason: They cost less to build and can be built on wheels to be moved in the future.

Many of your materials and labor are going to be priced per square foot, so reducing the square footage of your dream home will naturally make it more affordable. For instance, building a 2,000-square-foot home will cost much less than a 3,000-square-foot one. If you decide to build a tiny home, which by definition is under 400 square feet, you're going to save even more money.

The average cost to build a tiny home is about $20,000 to $60,000 for materials. Depending on whether your tiny home is mobile or stationary, you may also have to buy land to build it on.

According to the USDA’s 2022 Land Value Summary, you’ll pay about $3,800 per acre for rural real estate. However, the cost of land will depend on the state you plan to live in, 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.

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 as well. Plus, they can help you avoid problems since they’ve likely had a lot of experience navigating home construction issues throughout their career.

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4. Save Costs By Becoming A General Contractor

If you have building experience or a large network of skilled laborers, you may decide to act as your own contractor and manage the home building process yourself.

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, it might be wise to use subcontractors for some work if this is your first time building a house. Correcting your mistakes can be costly and time-consuming. 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

Designing your home can cost a lot of time and money. If you don’t get your building permits approved in a timely fashion, for instance, the construction on your new house could be delayed. Any changes that you make to your building plan during the construction process can also add to the total cost of the build.

Plus, if you start building the house without getting your plans approved by your city or county, you risk hefty fines (or worse, having to redo some of your already completed work). That’s why it’s important to get your plans approved early in the planning process before you start construction.

If applicable, you should consider securing an approval letter from your mortgage lender at this phase. While you can start construction without mortgage preapproval in most states, you could have issues securing your loan later on without it.

6. Budget, Plan And Price Out All Items

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

Whenever prices change or a cost gets added, make sure you put it into 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 don’t go over your budget.

If you’re using a construction loan or another type of financing, you’ll need to have a cost breakdown anyway. Your lender will likely want to see how much you plan to spend on each step of the project when you apply for mortgage preapproval, so it’s a good idea to have at least a rough budget before you start construction.

7. Choose Building Materials Wisely

Choosing cost-effective materials can help keep the project more affordable and within budget. Here are a few different types of building materials to consider for your home’s construction.

Reclaimed Materials

Using reclaimed materials like old barn doors or wood in your home build is not only trendy, but can also save you money. Look for reclaimed doors, wood floors, windows and decorative items when planning the design of your house.

Not sure where to find reclaimed materials? Check Craigslist, Planet Reuse or a salvage store. You can even 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. Having the walls built indoors and shipped to the site ready to install can cut down on any required construction. Plus, it can reduce the time spent on framing and drywalling.

Opting for prefab panels can also help you save money because you aren’t paying for the extra labor costs to build and frame the walls. Just make sure you have the appropriate building permits before constructing any prefab housing.

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 the weather.

Shipping Containers

This alternative housing idea uses old shipping containers for the structure of the home. Since the structure is already intact, this type of housing can help you save money on construction costs.

You’ll need to consider the modifications you’ll need to make to the container to turn it into a usable living space. Costs can also go up if you need more than one container to create your shipping container home.


Cob is a mixture of straw, clay and subsoil. This earthen material is so thick that it provides thermal, energy-efficient benefits. 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 inevitably needs to be fixed. This makes it a great building material for a cheap house.

8. Buy Materials At A Discount

Materials are one of the most expensive costs of building a home. Reducing the total cost of materials from your budget can cut back on the total cost to build your own home. When you begin shopping, consider asking each supplier if they offer a builder’s discount. If you’re constructing the house yourself, you may be able to qualify for a discount on your building materials.

Your contractor might also be able to acquire any necessary building materials at a discount as well.

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

If you’re interested in creating an energy-efficient home, you might reduce your carbon footprint and save money in the long run. 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 panels or wind energy as a power source for your property. Check to make sure that these are available in your area and are the best option 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 can’t afford? Consider doing some research and taking on the projects yourself. Going the do-it-yourself (DIY) route can save you money, especially when it comes to things like painting or laying flooring.

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

The Bottom Line: Building Your Own House Can Save Money, But Presents Challenges

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 building costs.

Before deciding to build, you’ll likely want to learn more about financing the construction costs. Rocket Mortgage does not offer construction loans at this time.

If building a home sounds too complicated, an existing home might be your best option. Fill out a mortgage application with Rocket Mortgage® to see how you qualify.

Headshot of Dori Zinn, personal finance journalist and writer for Quicken Loans.

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.