It costs anywhere from $225,000 to $342,500 to build a custom home in Alabama. And that’s just for construction! Land costs can add a hefty $3,000 to $60,000. Let’s not forget about the rising costs of permits, materials, and labor fees.
In contrast, buying an existing home in the Cotton State is a faster and more cost-effective option. A 27.5% price drop makes this the perfect time to find your dream home.
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Cost Breakdown of Building a Home in Alabama
The average house size in Alabama is 2,500 square feet. Here is a cost breakdown:
| Cost Head | Average Costs |
| Land Cost | $2,100 – $60,000 |
| Water and Sewer Inspections | $400 – $4,200 |
| Building Permits | $200 – $1,000 |
| Foundation | $4,500 – $12,000 |
| Framing | $14,000 – $32,000 |
| Exterior Siding | $4,500 – $22,500 |
| Roofing | $3,000 – $20,000 |
| HVAC | $3,000 – $7,000 |
| Plumbing | $150 – $500 |
| Electrical | $4,000 – $8,000 |
| Drywall | $8,000 – $20,000 |
| Painting | $3,000 – $8,000 |
What Is the Cost Per Square Foot to Build a House in Alabama?
Alabama home construction costs depend on the square footage and number of bedrooms in your home:
Material Cost of Building a House in Alabama
You can expect to spend about $50 per square foot on material costs. Here are the material expenses you need to consider to build your home in Alabama:
- Framing Materials: Foundation, lumber, and steel beams will require about $8,000 to $26,000
- Roof Installation: The roofing cost depends on the type of material you select, the roof’s slope, and the size of your home.
- Exterior Finishes: Prices may vary based on your choice of exterior. On average, it ranges from $4,500 to $40,350.
- Insulation: Fiberglass, drywall, and foam insulation help regulate the temperature inside your home. It costs $1,500 to $6,000 for the installation.
- Windows & Doors: If you hire a professional to install windows and doors, it will cost from $2,000 to $12,000. If you go DIY, it will be from $1,500 to $10,000.
- Flooring Materials: The cost of wood flooring installation in Alabama ranges between $3 and $10 per square foot.
- Cabinets & Countertops: Features like granite countertops and teak wood cabinets in kitchens may cost between $60 and $200 per linear square foot.
- Plumbing Fixtures: The cost to install sinks, faucets, showers, and PVC pipes throughout a home is between $5,000 and $15,500.
Labor Cost to Build a Home in Alabama
A contractor can help you hire laborers and professionals for the construction process. Their work and associated costs include:
indeed.com/career/mason/salaries/AL?from=top_sb(opens in a new tab)
| Professionals | Hourly Rate |
| Flooring Installers | $17.61 |
| Roofers | $21.44 |
| Painters | $19.20 |
| Masons | $24.35 |
| Landscapers | $17.03 |
| General Contractors | $17.93 |
| Plumbers | $24.89 |
| Carpenters | $21.91 |
| HVAC Technicians | $25.97 |
| Structural Engineers | $47.37 |
| Electricians | $25.90 |
What Are the Indirect Costs to Build a House in Alabama?
Indirect costs are incurred before the construction starts or after you move into the house. They include land costs, permit costs, interiors, etc.
1. Land Acquisition Costs: $37,000 Per Acre
Before you build your house in Alabama, you need to shop for land. The costs are:
- Purchase Cost: The average price per acre in Alabama is $3,280. This depends on the size and location of the land.
- Preparation Cost: You must clear and level the land before the construction. This can cost anywhere between $1,600 and $4,700.
2. Alabama Home Building Permit Costs: $5,000
The cost per square foot to build a home in Alabama includes permit fees. Construction or building permits are legal documents that authorize the construction process.
Permit costs and building codes are usually based on the construction type, occupancy type, home building area, and project scope. Some permits you may need, along with their average costs, are:
- Building Permit: $1,000 to $1,500
- HVAC Permit: $200 to $380
- Plumbing Permit: $50 to $500
- Electrical Permit: $10 to $500
3. Home Interiors: $20,000
Before you move into your new home, you’ll need furniture, electronics, kitchen appliances, and bathroom essentials.
The costs will depend upon your preferences and the quality of the finish. For a 2,000 sq ft home, you should budget at least $15,000 for interior furnishings.
How Can You Finance Your Home Construction in Alabama?
1. Home Construction Loans
You’re required to have a high credit score (above 480) and enough cash to make a 10% down payment of the project cost.
The two most prominent home construction loans are:
- Construction-to-Permanent Loan: This loan covers land purchases and home-building costs. It is converted to a conventional loan after the construction is complete, and you move into the house.
- Construction-only Loan: It only covers the cost of home building. Your entire loan amount will be due after your home is ready. You can pay back the loan in cash or take out a mortgage.
2. Home Equity Loan
If you have home equity, you can finance some or all of your new home’s construction with a home equity loan.
Your home equity is the difference between your property’s fair market value and the remaining loan amount.
Is It Cheaper to Build or Buy a House in Alabama?
It is usually cheaper to buy a home than to build a new one. However, by building your own home, you have the freedom to customize it to your needs.
The average price to build a house in Alabama is $175,061. This amount can go beyond $342,500 if you include land costs, excavations, permits, and other expenses. Moreover, new home construction can take up to 9 to 12 months.
On the other hand, you can buy a home in Alabama for $276,900. You can also easily find homes for sale in Alabama under 200k in 1.5 to 2 months. So, buying a turnkey home is not just cheaper but also faster in the current Alabama housing market.
Cost to Build vs. Cost to Buy in Alabama Cities
Let’s compare the cost to build a house and the cost to buy a house in Alabama’s most popular cities:
| City | Average Cost to Build (Including Land) | Average Cost to Buy |
| Birmingham ($165 per sq ft) | $472,500* | $164,950 |
| Montgomery ($135 per sq ft) | $397,500* | $210,000 |
| Huntsville ($144 per sq ft) | $420,000* | $345,115 |
Clearly, the cost to build a house is higher than the cost to buy one. If you buy a home for sale in Alabama, you can move in quickly and renovate it as you wish.
Disclaimer: The content in this blog post is for informational purposes only. It should not be construed as advice or recommendation. Houzeo does not provide any legal or financial advice. The figures mentioned in this blog post are the estimated average costs for the state/city in question. They are applicable as of the date the blog was written. Actual costs may vary depending on various factors, including location, specific building plans, materials used, labor costs, permits, and other local factors.
Please consult with local builders, contractors, and architects to obtain accurate and up-to-date pricing information for your specific project.
Frequently Asked Questions
What does it cost to build a house in Alabama?
It costs $225,000 to $342,500 on average, excluding the land cost. This will vary depending on location, property type, labor expenses, material costs, etc.
How much does it cost to build a house per square foot in Alabama?
Building a house in Alabama costs about $90 – $140 per square foot. Home-building costs depend on property type, construction area, labor costs, etc.
How much does it cost to build a 3-bedroom house in Alabama?
The average cost to build a three bedroom house in Alabama is between $225,000 to $342,500.
How much is the cost per sq ft to build in Montgomery, Alabama?
The house construction costs in Montgomery can be anywhere between $100 to $150 per square foot. You can check the complete cost breakdown and plan your budget.
