Yes, custom homes are more expensive than "regular" homes. Besides, if you were asking for the entire basement to be finished, you have a 4,000 sf home, not 2,000 sf.

Changing to a eight foot basement ceiling is a huge mistake, if by that you mean shortening the foundation walls. If you have a finished basement, the best way to go is a dropped ceiling downstairs with plenty of space between it and the floor above. That gives you plenty of space for wiring and mechanicals that can be placed between floors, which is one of the big advantages to a basement. Just putting all the HVAC ducting between floors in conditioned space will save you enough money to more than pay for the extra foot of foundation height.

We have 16 inch high ductable floor trusses and nine foot foundation walls. We are installing an eight foot dropped ceiling, giving us 28 inches between the floors for mechanical and wiring, all accessible for changes, additions, and maintenance.

Our first bid was similar - because he knew that we were planning on doing some of the work ourselves, he was nice enough to include in the bid how much would come off the bid for certain items. Like $1500 for appliances, and $1.50/sq ft for flooring. Can you even get flooring installed for $1.50? Despite the fact that we liked the builder's quality, we were so insulted by the quote that we never contacted him again. Some of the cost was likely due to labor costs being so high after Katrina, the rest probably had to do with him have plenty of work and not wanting/needing our project.

Keep getting bids! Our first bid, with the builder we really wanted to use, came in at a devastating 30% over budget. We almost gave up on this house. We ended up bidding it out to 6 more builders, and the pricing was significantly better- and kept improving as they each competed for our business. The bidding process was time consuming and stressful, but we learned a lot along the way and ended up with a much more thorough/inclusive bid from the builder we finally chose (still 5% over budget- but cheaper than starting over with the architect!).

I'd get more bids. Was the geothermal separately bid? If you plan to finish your basement in the future, I agree with the prior poster who said it would be a huge mistake to go with 8' basement walls.

We don't really want to go with another builder. This guy is going to finance the construction out of his pocket on our land, so we just need an end mortgage. He also took the "canned" plans we liked and tweaked them to exactly what we wanted with no up-front charges. Though he asked that we not share HIS plans with another builder (makes sense--his work).

We've decided to not go with the fiber cement board siding after seeing a few building with it today. We're thinking we'd like a 6" lap high quality vinyl instead.

We have another showing on our for sale house tomorrow! We're getting 1-2 per week so far. A offer is bound to come soon! :) (Positive thinking!!)

What made you change your mind on the fiber cement?
I had high end vinyl on my last home and have fiber cement on our current home and will never go back to vinyl.

This guy is going to finance the construction out of his pocket on our land

A professional builder would factor in a markup over his cost of funds on this construction loan. I know I certainly would. (Here, the rate would be in the mid to high teens.) Keep in mind that competitive quotes must be on the same basis to be useful.

We too are building very similar to you minus geo and our prices have come in at $259./sq ft inc finished basement

we too thought the recession would follow into the building end but no way, and our current house is int he high end for sales which is really slow so we have got hooped on both ends!!

You might want to take a closer look at the cost of the geothermal. My builder was only able to get two companies to bid on it, the first one came in at $80ishK...obviously he didnt want to do it. The second came in at $42K compared to $24K for high efficiency heat pumps (this is for the whole HVAC contract).

I really wanted geothermal but couldn't justify the cost.

We have one geothermal bid at $24K, and its too high. We are getting a second bid this week. These also include the entire HVAC contract. Our bids are for horizontal ground loop systems.

We just received our first "preliminary" bid back also. It turns out that the first builder we chose to give our plans to for bid, has built a similar home several times as a spec in a nearby town. The price he gave us was for the house that he has built in the past (2200 sq ft ranch) with the finishes he used in those specs. He is now working on pricing out all of the finishes I have specified and will give me a new bid for our 2600 sq ft project with unfinished basement.
The current bid per sq foot is $125 for nice finishes but this includes 900 sq ft finished in the basement of his current house. I am sure he is estimating a lower rate for finishing the basement than he is for the main floor. So if I figure $50 sq ft for the finished basement then the price for the main floor increases to $155 per sq ft.
I would much rather he bid my project as it's own rather than comparing to a past project and will definitely start looking for other bids.