The most common question about house is which is better and cheaper between building and buying a house. Most people don’t understand how to calculate costs of houses. This second question can be easily answer by estimating what all of factors and components are used to calculate this cost. But the answer of this second question is different with first question. The answer of first question is relative depended on each people considerations. Cheap is better for people with limited budget, but not always good for people with unlimited budget. So, we will focus on the second question.
We must distinguish costs of houses, between building and buying a house. Components for calculating overall costs are different. First explanation to build a house. When we build a house, the main costs are material cost and cost for paying builders. It’s assumed that we have land, so we don’t spend anymore budget to buy land. If we buy ready made house plan, this house plan can be added. If we hire contractor., this will spend more cost, because the look for profit. All of costs will be marked up by them.
When we buy a house, costs of houses component is more than build house by our self. Here there are tax component and profit component that will be added. Profit is taken by marked up building cost become final price. It’s for covering all of company cost for paying employee and so on. So it can be understood that building a house by our self is cheaper than buy a house. With the same budget, we can build a house bigger with more rooms than if we buy a house.
But there are different advantages between these options. It will answer the first question. If we want to save money, building a house is better than buy a house, but it’s with one condition that we have ability to handle all of aspects to build this house. Without good planning, building a house without enough skill, knowledge and experience will be difficult task with some risks.