12/06/2025
Why “Price Per Square Foot” Isn’t the Whole Story
The Common Question
Clients often ask: “How much per square foot does it cost to build?” While it sounds simple, square-foot pricing is not the most important part of the estimating process.
The Problem with Focusing Only on the Final Number
- Many people flip straight to the last page of an estimate, looking only at the total cost.
- They overlook critical details: what’s included, what’s excluded, the allowances, and the terms.
- A low bid can hide unrealistic allowances or generic pricing that doesn’t match your prints.
- If a contractor underbids by $100,000, you may end up with a half-finished home.
Trust Matters More Than a Formula
- The most important factor is whether you trust your contractor.
- Building a home is a complex, sometimes love-hate relationship — not a Hallmark movie.
- A contractor who bids higher may simply be putting reality on paper, protecting you from costly mistakes.
Breaking Down Square-Foot Pricing
Square-foot price is calculated by dividing the total cost by the square footage.
- Under Roof Square Footage: Includes porches, garages, and all covered areas.
- Living Square Footage: Includes only heated/cooled living space.
- Banks typically use living square footage for financing.
Example 1: Top-Tier Finishes
- 1,000 sq ft living, 2,500 sq ft under roof
- Total cost: $150,000
- $150,000 Ă· 2,500 = $60 per sq ft under roof
- $150,000 Ă· 1,000 = $150 per sq ft living
Example 2: Modest Finishes
- 1,000 sq ft living, 1,500 sq ft under roof
- Total cost: $100,000
- $100,000 Ă· 1,500 = $66 per sq ft under roof
- $100,000 Ă· 1,000 = $100 per sq ft living
Notice how the numbers shift dramatically depending on what’s included. The same “per square foot” rate can make one project look artificially expensive or cheap.
The Takeaway
- Square-foot pricing is a quick comparison tool, but it doesn’t tell the whole story.
- Realistic estimates require detailed scope, accurate allowances, and honest communication.
- A higher bid doesn’t mean the contractor is difficult — it may mean they’re saving you from a financial disaster.
---
Joshua Doucet