Eye On Housing
The NAHB recently published its latest Cost of Construction Survey. Results show that 61.1% of the average home sale price consisted of construction costs in 2019, up from 55.6% in 2017, but similar to the 2013 and 2015 breakdowns of 61.7% and 61.8%, respectively.
The finished lot cost was the second largest cost at 18.5% of the sales price, down from 21.5% in 2017. The average builder profit margin stood at 9.1% in 2019, compared to 10.7% in 2017 and 9.0% in 2015.
At 4.9% in 2019, overhead and general expenses were essentially the same as in 2017 (5.1%). The remainder of the average home sale price consisted of sales commission (3.7%), financing costs (1.7%), and marketing costs (1.0%). These percentages are also similar to their 2017 breakdowns.
Survey respondents broke down construction costs into 8 major construction stages. Interior finishes, at 25.4%, accounted for the largest share of construction costs, followed by framing (17.4%), major system rough-ins (14.7%), exterior finishes (14.1%), foundations (11.8%), final steps (6.8%), site work (6.2%), and other costs (3.8%).
See Table 1 below for more details.
Please click here to be directed to the full article (which includes historical results back to 1998).
Thanks for your info. It is very useful to all home builders.
Where is the 2020 and 2021 versions of this? It’s really helpful for us all to know how it all breaks out
Unfortunately, new editions of this study are on hold until further notice.
Why do we not have costs for 2022? We are not pricing at 2019 rates or we would be in trouble. I think you will see a great jump in costs.
This is a once every two year survey. New data are now being collected.