First thought, you cannot build based on a cost per sq ft anymore than you can buy a car by the pound. Determine options, quality level etc. Per sq ft pricing is useless unless it is in very basic spec house. Custom builds are a diff animal.

Most builders know approximate price/per sq ft it would cost them to build "a house". Normally cost to build depends on: sq ft, finishes and level of finishes. [And I would add efficiency of the structure]. The scheduler of costs is very long and no builder wants to go over every single cost for a rough estimate. You say I want a house with a nice kitchen WoodMode cabinets, we will add 30k to the estimate for cabinets. Tile walking shower + $7k. All hardwood floors - 10/sq ft * total sq ft. Roof with one shed dormer - no problem, $3k ... And so long. Most trades also charge per sq ft. So math works out. Every custom item costs money. Mass production builder will have less expensive pricing, custom builder pads more for overhead & profit.

Watch out: some builders do not include cost of garage when estimating cost based on livable sq ft.

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Financing: between you and the bank or you and the builder[if builder financing is available].

Go talk to your banker, or if you don't have a personal relationship with a local banker, go talk to 2-3 local bankers to find out how the financing options work.

Then you have to decide: 1) custom home designed by an architect; 2) semi-custom home built before by a builder with some cosmetic changes; 3) a tract home by a builder or home building company who builds multiple homes at a time.

You can also shop the Internet for the plans factories for a generic design, but it's important to know that these will not be designed to fit your land, meet local codes and regulations and will not have plans for site work, foundation, structure, HVAC, electrical or plumbing, among others. Many of these online plans don't even have a location for the water heater or furnace.

Good luck with your project. Exciting times ahead.

Bought a house. Had it torn down.

Built the replacement house myself cash, no loan. Mortgage free since 2007.

Hmmm . . . well . . . . decide how much you're willing to spend and then add about 20% to that. Nothing goes as you plan!

One of the best things we did was find an architect early on who understoord our budget and understood that we were doing almost everything ourselves. His design was smaller and more efficient that what we had sketched out on our own - he showed us where we could make compromises to get down to our budget, we still got everything we needed, and we LOVE the house. I'm sure not every architect would have been this way, but it's worth interviewing some (interviews/initial meetings are free) to get some ideas and see if you can find someone who can think about how to simplify and what can be done to make the building process more efficient. In our case, or architect defintily saved us money and we got a nicer house. You want to be really upfront about budget here (and maybe give a number a bit lower than your actual max), beacuse it's easy to have your eyes get bigger than your wallet.

We were acting as GC as well as doing the carpentry and a lot of the other work ourselves (but we contracted out things like plumbing/heat, electric, roof, insulation, excavation, etc.). All during the design process and initial planning, we kept a spreadsheet of known costs. We broke down all the parts of the house (foundation, roof, doors, windows, plumbing, tile - everything down to the $100 medicine cabinet) and plugged in the best cost info we had. We used the homewyse online estimators for services and home depot online pricing for products at first, then plugged in actual estimates from contractors as we got them, then finally the actual costs when they occured. This allowed us to keep a really good eye on the budget, and understand when something had gone over and we needed to cut something in the future, or up the total budget.

We had enough cash saved to not take out a loan, and I think that actually saved us a lot of money. Because we weren't having to draw down from a loan, we could pay the sub-contractors right away (I am postitive we got better service/prioritization because of that), and we were also able to put off some finishing details that a bank would have required be finished on a certain timeline. I know a family member who still has wall to wall carpet in their house, because the bank required it 20 years ago. They hate it, but that's what was required, and once it's in, it feels like too much work to change. Someone else told us they rushed all their detailed finish work (trim, stair railing, etc.) because the bank needed it done in x amount of days - it didn't come out very nice, but it was done on time. For us, the only penalty of taking longer was having to pay another month of rent - so that was a huge freedom. It was also really nice to be able to make all the decisions ourselves, rather than checking with the bank to see if they would allow things - just one less stressful thing in a very stressful project.

We had enough cash saved to not take out a loan, and I think that actually saved us a lot of money.

It's like ARG likes to say (IIRC)...it's possible to build a house cheaply if you have plenty of money, but seemingly impossible to build cheaply if you're short on cash.

Thanks, all, for your comments. I am thinking about all of this. I know the deal about sq. footage, but both builders knew (more of less) the type of finishes we were looking for. It just threw us for a loop. In any case, the point is moot. I have a lot more homework to do, it seems. Keep the comments coming—I'd especially like to hear from people who had to get a loan for construction and how that rolled into a mortgage, since that's what we'll be doing. I'd like to be able to pay cash for everything, but I'll settle for being able to put a hefty chunk down.

Your concerns and inquiries are very reminiscent of my own at the very beginning. It's all so confusing and you just want someone to give you a ballpark estimate. I get it. The question became how much exactly do we have to work with? We did a construction to permanent loan. One closing and the rate is fixed. We were able to control how much we wanted to put down. The bank said we were able to finance 95% of the appraised value. I'll be honest this scared me and made for a large monthly mortgage. We came up with a down payment that we were comfortable with. The loan uses our down payment first and then taps into the loan by way of a draw schedule. After our down payment is used up we will pay interest on the loan but it does not go toward the principle, however it is tax deductible. Things we are paying for outside the loan are cabinets, vanities, lighting, mirrors, and a few other miscellaneous items. We do have some allowances in our contract but we can use them for overages or they can be refunded to us if they are not used. I got insanely good prices on kitchen cabs and bath vanities and it just seemed easier to pay out of pocket for those.