Now throw in fancy landscaping, a pool, upgraded finishings and we’re reaching into the $200psf range.

In contrast, it would cost a production home builder anywhere from $65-90psf to build the same home (in the LA/OC area).

Since construction has slowed down significantly after the housing/credit bust, I have seen costs drop down to $55psf in the outlying areas (Antelope & San Fernando Valleys). Needless to say, subcontractors are hurting from lack of work.

Soft costs are non-building expenses such as permits, architectural fees, origination points, transfer taxes, title insurance, appraisal fee, overhead, hazard/cost of construction insurance etc. These can be significant and raise the $/sqft by as much as $35-$50/sqft.

Hard costs are the physical items such as land value, site prep/grading, labor, materials, cost overruns etc. From the look of it, this property can qualify as a custom home with its marble floors, landscaping and high end appliances/fixtures. The costs associated with this can further add to the building costs.

$225 may be on the high side, but it’s not that far off. Since he frequently works with local builders, TheArcadian is better fit to answer your question. Thanks for your input.

We are assuming a decked-out McMansion with quality material to go along with their Robert Tong floor plan. Since this house was being built right as the bubble popped, sub-contracting costs most likely haven’t decreased yet.

But yes, a new home can be built for cheaper.