A custom-built home lets you personalize your dream home right down to its foundations, but building a new home is not always cheaper than buying an existing home. If you’d like to take control and spell out every single detail about your future home, then building allows you to do so, but with added costs. Purchasing the land, having designs drawn, getting permits, and obtaining a construction loan can all add costs even before construction begins.
Costs can vary depending on your location, as expenses such as materials and labour can be cheaper or more expensive in certain areas. Land prices can also significantly impact your total cost of construction.
According to Altus Group, a single family home with an unfinished basement from a production builder can cost between $145 to $260 per square foot in Vancouver, to as little as $105 to $180 per square foot in Montreal. Production builders limit you to a set range of house plans, which will restrict your design choices. In exchange for this, building a home with a production builder is much cheaper than building from scratch with a custom home builder.
A custom-built home is significantly more expensive than a regular single-family home, costing on average $430 to $1,090 per square foot in Vancouver, compared to $390 to $800 per square foot in Montreal.
Based on data for 2020, building a new home in Canada would be cheapest in Halifax. Vancouver is the most expensive city to build a new home in Canada.
|Home Type||Production Single-Family Home (Stock Home Plans)||Custom-Built Single- Family|
|Vancouver||$145 - $260||$430 - $1090|
|Calgary||$125 - $185||$405 - $860|
|Edmonton||$130 - $185||$405 - $860|
|Winnipeg||$125 - $190||$410 - $860|
|Toronto/GTA||$115 - $215||$400 - $900|
|Ottawa/Gatineau||$120 - $195||$435 - $910|
|Montreal||$105 - $180||$390 - $800|
|Halifax||$90 - $150||$250 - $500|
You can use these costs per square foot to estimate how much a home would cost. For example, the average size of a single-detached home in Ontario is 1,520 square feet, 1,430 square feet in British Columbia, and 1,150 square feet in Nova Scotia.
Recently built homes, considered to be homes built after 2000, are larger than older homes. Homes built after 2000 are on average double the size of homes built in 1960.
In 2016, the average size of a newly built single home in Ontario was 2,380 square feet, 1900 square feet in British Columbia, and 1,530 square feet in Nova Scotia. This means that building a new single home in Toronto with a production builder would cost between $273,700 to $511,700. If you would like to have full control over the design of your home, a custom-built home will cost between $952,000 and $2,142,000 in Toronto.
|City||Average Home Size||Cost of Single-Family Home||Cost of Custom-Built Home|
|Toronto||2,380||$273,700 - $511,700||$952,000 - $2,142,000|
|Vancouver||1,900||$275,500 - $494,000||$817,000 - $2,071,000|
|Halifax||1,530||$137,700 - $229,500||$382,500 - $765,000|
One of the first steps in constructing a new home is finding a place to build it. You can work with a real estate agent to find land to purchase, or you could search for vacant land listings online.
Land prices in urban areas are significantly more expensive than rural areas. Land in the GTA can range from $50 to $200 per square foot, or less than $50 per square foot in Calgary or Edmonton.
Living in the countryside means that land will be cheaper, but there can be higher costs associated with rural living, such as utilities and living expenses. The average price per acre of farmland in Canada was $3,245 in 2019. Ontario had the most expensive farmland, at $11,446 per acre. Within provinces, land in urban areas is more expensive. For example, farmland surrounding the GTA costs on average $17,834 per acre, while farmland in Northern Ontario costs $3,621 per acre.
|Prince Edward Island||$3,905|
|Newfoundland and Labrador||$5,022|
|South Coast||British Columbia||$102,067|
|Vancouver Island||British Columbia||$57,500|
After purchasing a plot of land to build on, you would need to find a way to finance construction costs. Construction loans are a way for you to borrow money to build a home. Money is disbursed from your construction loan lender at certain checkpoints in the home’s construction process. You may also use funds from a construction loan to purchase the land to build your home.
While construction loans can cover most of the total construction cost, it will not cover all costs. Most construction loans will only cover up to 75% of the total construction cost.
According to HomeGuide, installing HVAC for a new home can cost from $13,000 to $17,000, and includes the central air conditioner unit, furnace, and ductwork. Plumbing can cost around $4.50 per square foot, or around $8,000 for a new home. According to Advantage Electric, wiring a new house in Canada costs at least $13,000.
ICF estimates that a foundation with a basement would cost from $22 to $26 per square foot, or $40,000 to $48,000. HGTV Canada says that a shingle roof can cost from $2.50 to $11 per square foot, or $4,750 for the average roof. Eaves can cost $1,000, wall sidings can cost $8,000 to $20,000, exterior doors about $700 each, windows at $55 per square foot or $1,000 per window, possible skylights costing $3,300 each, patios from $4 per square foot for patio stones or $8 per square foot for wood decking for an average of $2,500, and driveways about $3,050.
Hardwood flooring can cost $7 per square foot, marble tile can cost $15 per square foot, or carpet can cost $4 per square foot.
|Construction Type||Average Price|
|HVAC||$13,000 - $17,000|
|Foundation||$40,000 - $48,000|
|Wall Sidings||$8,000 - $20,000|
|Exterior Doors||$700 each|
|Flooring||$4 - $15 per square foot|
An architect would cost around 6% to 12% of the home's price. If you only want an architect to review an existing home plan, it may cost from $1,000 to $3,000. You may purchase stock house plans for $750 to $1,500, or hire a drafter to create a home blueprint for $1,000 to $3,000.
The cost of building permits vary. For example, Toronto charges $198.59 for a building permit, plus $85.79 per hour for examination and inspections. Vancouver charges $168 for the first $5,000 estimated cost of work, plus $10.70 for each $1,000 over $5,000 and under $50,000, and $5.40 for each $1,000 over $50,000.
Halifax's building permit costs $0.30 per square foot with a minimum cost of $25.00, plus $0.10 per square foot for basements and $0.10 per square foot for garages. Building permits in Winnipeg cost $219, plus $0.41 per square feet.
|City||Building Permit Fee|
|Toronto||$198.59 plus $85.79 per hour of examination and inspection|
|Vancouver||$168 for first $5,000 construction cost|
$10.70 for each $1,000 over $5,000 in construction costs
$5.40 for each $1,000 over $50,000 in construction costs
|Halifax||$0.30 per square foot at-ground and above-ground|
$0.10 per square foot of basement
$0.10 per square foot of garage
|Winnipeg||$219 plus $0.41 per square feet|