When constructing home, it is difficult to stay on budget. There are lots of hidden costs involved that are usually not included in the budget.
1. Soil and contour test
Before giving a fixed quote for building your home, builders will do a soil and contour test. These two tests can cost from $14,000 to $20,000. In a soil test, surveyors drill 3 holes in your property and analyze the soil. If the soil is rocky or has any other problem, then the cost of constructing home will increase. The contour test survey of the land and gives report on the slope of the property. A sloped property will result in extra costs.
2. Site Costs
This is the largest hidden cost involved in constructing home. The site cost depends on the results of your soil and contour test. If the soil is of poor quality and the slope is greater, then the site costs will increase. If you have to remove lots of trees from the site to start the construction process, then there will be extra cost. Site costs vary from $10,000 to $ 70,000.
3. Interest repayments during construction
Even if your property is under construction, you will have to pay the interest on the loan you have taken for the property. So, this is a major hidden cost that is not included in the budget. The amount of interest varies according to the size of the loan, interest rate and scheduled payment terms.
You should be prepared for these extra expenses when you start building your home. If possible, you should include these hidden costs in your budget so that you don’t have difficulty in providing these fees later on.