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How Much Does it Cost to Build a House in California?

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The most populous U.S. state with nearly 40 million residents, California is a melting pot of cultures and a center of urban and economic development. It also has a diverse geographic landscape from the Pacific Coast to the Sierra Nevada mountains.

The Cost of Building a Home in California

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Traditionally a state where single family homes thrive across all its regions, the recent passage of Senate Bills 9 and 10, which open up opportunities for more higher-density housing to be built, is poised to hopefully help alleviate the homelessness crisis brought about by its ever-growing population.

However, many single family residences are still slated to be built this year — projects put on hold by labor and supply chain issues that bottlenecked construction over the last few years stemming from the pandemic. These concerns have also driven construction costs up in an area where they were already steep to begin with. Generally, building a standard home in California will now start at about $400 per square foot. A mid-range home, which could include more customized features and higher-grade fixtures, will cost about $500 per square foot. On the other hand, a luxury home could cost $600 per square foot and beyond.

Figure 1. Typical cost breakdown of a single-family home constructed using the conventional method, according to Home Builder Digest. Image Source: National Cost Guide.

The cost of construction will vary from one location to another due to several components that can be classified into two major categories: hard costs and soft costs. Hard costs include everything that goes towards the physical structure of a home, including the cost of labor and materials. Everything beyond that, such as the cost of land, permit fees, and architecture and design fees, will fall under soft costs. For California, here they are discussed by region:

Superior California

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Anchored by state capital Sacramento, Superior California sits at the borders to Oregon and Nevada. Made up of 17 different counties, namely Butte, Colusa, El Dorado, Glenn, Lassen, Modoc, Nevada, Placer, Plumas, Sacramento, Shasta, Sierra, Siskiyou, Sutter, Tehama, Yolo, and Yuba, it is one of the largest regions in the state.

Based on estimates of how much it costs to build a home across these different counties, a standard home in the region would typically cost between $140 to $175 per square foot. A home in the mid-range would cost between $200 and $300. A luxury home would go up to $325 to $400 and beyond.

Sacramento-based custom home builder HouseIdea further explains that the cost to build the structure itself typically accounts for 75% of the total expenses. For a 2,000-square-foot home, lot finishing, landscaping, grading, utilities, permit and design fees can add up to $80,000 or more.

For Heating, Ventilation, and Air Conditioning systems (HVAC) in particular — an essential in the warm region — Sacramento-based company Clarke & Rush lists the cost of installation as follows:

  • Central Air Conditioning Installation: $3,500-$7,600
  • Ductless Air Conditioning Installation: $3,000-$5,000
  • Gas Furnace Installation: $4,000-$6,500
  • Heat Pump Installation: $5,000-$6,500

The exact cost will vary based on the size of the room or house, as larger homes will usually require bigger air-conditioning units as well.

Lots in Sacramento listed on Zillow and Redfin average between 7,000 to 8,000 square feet, costing an average of a little over $200,000 or about $30 per square foot.

Most counties in the region follow the Title 24 Building Standards from the California Code of Regulations. In Sacramento County, in particular, permit fees are charged at an hourly rate based on a project’s total valuation. The county’s permit fee schedule reflects the following computation for new construction, remodel, and alteration projects:

Figure 2. Computation of permit fees for new construction, remodel, and alteration projects based on Sacramento County permit fee schedule.

Home enthusiast blog This Old House puts the percentage of construction cost charged for architecture fees between 5 to 15% for new-builds. Hourly fees could run between $60 to $125 or higher for urban areas like Sacramento.

Major City

Sacramento

For the state capital, the residential sector is expected to remain strong as it has through the pandemic. The move to green energy is also keeping the infrastructure sector growing. With most other industries being able to continue to operate remotely, unemployment has been kept relatively low, as the construction industry also added new workers in light of the market boom.

More affordable housing projects are also being built in the area. The city has purchased 102 acres in South Sacramento to be allotted for this purpose. Three hotels in the area are also set to be converted into permanent housing, including one downtown. 

Other affordable housing projects in the region include a 60-unit project in West Sacramento, 63 new units in the third phase of the mixed-income Mirasol Village in River District, and an 80-unit project in Diamond Springs in El Dorado County. The state awarded more than $923 million for affordable housing in February, with $74 million for this area.

North Coast

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Often referred to as wine country, the counties of Napa and Sonoma in the North Coast of California are as rich in architectural styles as they are in wineries, approximately 800 of which are found in the region.

Based on bid data from online contractor marketplace BuildZoom (BZ), building a home on the North Coast would start at around $145 to $250 per square foot. A more customized home with special finishes would range between $250 to $325 per square foot. Luxury homes in the area could cost up to $350 per square foot and beyond.

Sonoma-based publication Modern Living Sonoma details the following cost breakdown for a three-bedroom, three-bathroom 2,600-square-foot home:

  • General Project Management and Infrastructure Costs – $255,000
  • Site Preparation (including demolition of existing structure) – $340,000
  • Concrete – $261,000
  • Woods, Plastics, and Steel for Framing and Cabinetry – $505,000
  • Thermal and Moisture Protection – $100,000
  • Doors and Windows – $278,000
  • Finishes – $333,000
  • Equipment and Appliances – $42,000
  • Electrical Wiring and Lighting – $115,000
  • Labor Costs – $361,000

This project would fall into the luxury range, but the breakdown is a good point of reference of things that should be considered in this region’s landscape.

The cost of land in the region varies widely based on listings on Redfin, with the average costs ranging between $850,000 and $2 million.

Major Cities

Napa

Downtown Napa serves as the valley’s urban center, being the county seat. Houses in Napa include both 100-year-old homes and modern structures. The average land listing in the city is at just under $900,000, starting at $15,000 for a 10,376-square-foot lot going up to $7,900,000 for 73.8 acres.

The City of Napa’s permit fee schedule outlines the following charges for single family homes:

Santa Rosa

Sonoma’s county seat and also its largest city, Santa Rosa is recovering from multiple wildfires in the last five years. It houses Sonoma County’s two largest hospitals, as well as a museum honoring city native Charles M. Schulz, creator of the Peanuts comics, after whom the nearby airport is also named. The average land listing in the area is just above $1,500,000, with lots starting at $100,000 for 25,264.8 square feet going up to $45 million for 32 acres.

The City of Santa Rosa permit fee schedule includes the following rates for single family homes:

Plan Check and Inspection

Mechanical, electrical, and plumbing permit fees are charged depending on the work that needs to be done, as outlined in the same fee schedule.

Sonoma

Sonoma City exudes the wine country charm the county and the whole region is known for, with many farmer’s markets and well-known restaurants alongside the staple wineries. Older and larger homes with space for vineyards fill the city square, while smaller homes are found on its outskirts. The average land listing in the area is just under $2 million, with lots starting at $350,000 for a 21,780-square-foot property going up to $5.5 million for 58.65 acres.

The city’s building department fee summary sheet explains how to calculate the different fees charged for new projects and more.

As of February, Napa County has started to receive the first few applications following the passage of Senate Bill 9 at the start of the year. The first few proposals have been for lot splits rather than developments. Of the 714,000 new homes expected to be feasible to build as a result of the law, as studied by the UC Berkeley Terner Center for Housing Innovation, the county’s share is roughly 5,000, with the city of Napa contributing roughly 2,700.

San Francisco Bay Area

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Home to Silicon Valley, the San Francisco Bay Area’s business and technology sectors have kept its residents employed in the midst of the pandemic. This has also kept its residential construction market afloat as people continue to move into the city for work. This has, however, continued to drive both living and housing costs up. Building a new home in the area starts at a cost of about $500 to $700 per square foot. A mid-range home with more customized features would cost between $700 to $800 per square foot, while a luxury home can still go far beyond this price range.

Listings for land in the area average at a little over $2 million, starting at $200,000 for a 4,473-square-foot lot in Silver Terrace with a view of the bay, and going up to $13 million for a 5,417-square-foot lot in the Northwest corner of Broadway and Taylor Streets with views of downtown San Francisco.

Architecture fees in the area can be charged as a percentage of the construction cost between 10 to 15% or an hourly rate based on milestones set early in the process. Smaller projects can also be charged a fixed fee.

It should be noted however that costs could vary widely within the diverse areas of the Bay Area. For San Mateo County, for example, the cost to build a home is lower, starting at $200 to $325 per square foot. A mid-range home would cost between $350 to $525, while a luxury home would be at about $550 to $650 and beyond.

Major Cities

San Francisco

From the world-famous Golden Gate Bridge to the iconic row houses along its undulating hills, San Francisco is a city that has charmed many over the years. This has also cemented its reputation as an expensive city to build a home. Nevertheless, it remains one of the most densely populated cities in the U.S., closely following four of the five New York City boroughs.

Unlike New York City, however, single family homes still dominate San Francisco’s residential landscape. Building a new home in the city would incur permit fees of around 6 to 9% of the total building costs. The first half is paid upon application for a permit, which also has two categories: Full Permit or Site Permit. New construction of homes would often merit a full permit, whose requirements include submitting architectural, structural, and mechanical and electrical plans, as well as Title 24 Building Energy Efficiency information. The fee for a full permit requires two payments: the initial filing fee and the issuance fee. Site permits often cover projects costing more than $25 million that have specific design and engineering plans.

San Jose

The heart of Silicon Valley, San Jose is both the largest and the most populous city in Northern California, anchoring the San Jose-Sunnyvale-Santa Clara Metropolitan Statistical Area. 

All single family homes built in the area will require a permit if they exceed 30 feet or two stories in height and a floor ratio of 0.45. The city’s Building Division Fee Schedule outlines the following costs for new homes:

Oakland

The seat of Alameda County, Oakland has a bustling artistic and culinary scene in the East Bay. It also lures its San Francisco neighbors to its hiking trails and redwood groves. The city presents various housing options from high-rise and mid-rise apartments in urban zones to spacious bungalows.

For single family homes, the City of Oakland Master Fee Schedule includes a $74 permit application fee for building, electrical, mechanical, and plumbing permits. Inspection fees for new construction projects are as follows:

Proposals have also started trickling in in the region following the passage of Senate Bill 9, starting with Palo Alto, even as some cities are still pushing back on its implementation. Builders specializing in ADUs and prefabricated homes are expanding to help homeowners redevelop their properties, possibly sparking a new kind of specialization in SB 9 redevelopments among small developers.

Central Valley

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Over the pandemic, homeowners leaving the Bay Area created a hot housing market in the Central Valley. Northern and Southern San Joaquin Valleys attracted remote workers due to the bigger and relatively cheaper living space they afford to their residents. Building a home in the Central Valley will start at about $180 to $200 per square foot. A mid-range home would cost about $200 to $400 per square foot, while a luxury home would go up to $440 per square foot and beyond.

Fresno-based roofing, solar, air conditioning, and windows installation company Grandmark provides the following estimates for roof installation in the area:

  • Flat Roof – $152.49 to $252.20 per 100 square feet
  • Asphalt Roof – $187.68 to $304.98 per 100 square feet
  • Tile – $879.75 to o$1,407.60 per 100 square feet
  • Metal Roof – $873.88 to $1,143.67
  • Slate – $850.43 to $2,111.40
  • Wood Shake – $615.83 to $809.37 per 100 square feet

Listings for land in the region have a wide price range depending on the city or county averaging between $280,000 and $1.7 million.

Architects typically charge between 8 to 15% of the total construction cost, while building designers will charge between 4 to 8%. Since the cost to build in the Central Valley is generally cheaper than in the Bay Area, the cost for an architect or a building designer will likely also be lower by anywhere between $2,000 to $11,000.

Major City

Fresno

The largest city in the Central Valley, Fresno is slated for widespread infrastructure redevelopment, with millions in funding given by California’s Cap and Trade program. A lot of single family homes are also being built in the city. Relatively speaking, the cost to build a home in the city today is still lower than many other areas in California.

Listings for land in the city and the county average lower than the rest of the region at $157,000, starting at $14,000 for a vacant lot in Shaver Springs and going up to $13.5 million for 48.87 acres near downtown Parlier.

The City of Fresno Master Fee Schedule charges plan check and inspection fees for single family custom homes depending on the size of the project, starting at $479 for 1,000 square feet to $1,164 for 7,500 square feet. A combination of mechanical, plumbing, and electrical permits will cost $89.

Central Coast

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With perhaps some of the most breathtaking views in the state, the Central Coast could be the best place to call home for those who appreciate both the peace and wonder of nature, with its varied topography and proximity to the ocean. According to data gathered from contractor marketplace BuildZoom (BZ), building a home in this region can start at $185 to $200 per square foot. A more customized mid-range home would cost about $305 per square foot, while luxury homes in the Central Coast go up to $350 and beyond.

There are, however, several factors to consider when building a home along the coastline. The California Coastal Commission regulates developments in this area by enforcing the California Coastal Act to help protect both the environment and its residents. On the flip side, it also gives incentives for those who share in its mission, such as fee discounts for properties certified by the U.S. Green Building Council’s (USGBC) Leadership in Energy and Environmental Design (LEED) arm. 

California-based firm Element Homes also advises would-be homeowners in the area to make sure they are ready to take care of the cost of maintaining their properties here. These tend to be higher in the Central Coast due to the exposure to higher loads and extreme conditions, as studied by the National Association of Home Builders (NAHB). As such, property owners should also prepare for the added inclusion of flood insurance and disaster coverage in their insurance policies.

Given its unique conditions, it would be good to tap an architect as well as a contractor to work on any project in the area. It would typically cost between 10 to 20% of the cost of construction paid to the general contractor to bring in an architect.

Major Cities

Santa Cruz

The county seat of Santa Cruz is a marriage of history and culture, with premier landmarks such as the University of California Santa Cruz and the Santa Cruz Beach Boardwalk bringing it to life against a backdrop of Redwood forests.

Land listings in the area average at $439,000, starting at $299,000 for a 27,878.40-square-foot CZU fire property in Bonny Doon and going up to $30 million for a 9,315,741.6-square-foot property at the Pacific Ocean that’s full of fertile farmland, equestrian facilities, and space for multiple residences and other structures.

The City of Santa Cruz Unified Master Fee Schedule stipulates a fee of $428 per 1,000 square feet for residential design permits. Electrical, plumbing, and mechanical permits cost $53.50 each on the initial filing.

Santa Maria

Nicknamed the BBQ Capital of California, Santa Maria also has a thriving wine industry. Lots in the area have large cuts and average at a little over $1.5 million on Redfin, starting at $197,000 for 58.91 acres in a private rural setting and going up to $5.9 million for 1,521 acres amidst natural springs, lush meadows, and 13 miles for horseback riding.

The Santa Maria Municipal Code indicates the following fees for single family dwellings based on size:

    • 1,000 square feet – $2,496.30
    • 2,000 square feet – $3,825.40
    • 3,000 square feet – $5,100.80
    • 4,000 square feet – $6,374.60
    • 5,000 square feet – $7,649.70
    • 10,000 square feet – $12,855.60

San Luis Obispo

Fittingly enough, the San Luis Obispo campus of the California Polytechnic State University (Cal Poly) has produced some of the most acclaimed architects in the state. Listings for land in the area average at a little over $2.5 million, starting at $425,000 for a 13,080-square-foot lot in Monterey Heights going up to $9 million for 360 acres in the historic Alberti-Madonna Ranch.

The City of San Luis Obispo Comprehensive Fee Schedule indicates the following fees for single family residential projects:

Engineering Fees

    • 0-2,500 square feet $156.40 + $4.77 IT Surcharge (if applicable) = $161.17
    • 2,501+ square feet $625.59 + $19.08 IT Surcharge (if applicable ) = $644.67

Inspection Fees

    • 0-2,500 square feet $258.17 + 3.05% IT Surcharge = $266.05
    • 2,501+ square feet $258.17 + 3.05% IT Surcharge = $266.05

Inland Empire

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Over the pandemic, housing developers have moved from coastal and urban areas to the Inland Empire to build more affordable housing options. For those planning to build their own homes in the area, the cost would start at $165 to $200 per square foot. A more customized home in the mid-range would cost between $200 and $245 per square foot, while luxury homes could go up to $300 per square foot and beyond.

The price of land in the area according to listings on Redfin average between $690,000 to $990,000.

Major City

Riverside

Seat of the county of the same name, Riverside is known to be the birthplace of California’s citrus industry. It is also home to the largest Mission Revival Style building in the country, the Mission Inn.

For those who plan to build their home in this historic city, fees paid to the Community & Economic Development Department Building & Safety Division cost $93.06 per square foot, covering the plan check and building permit. Permit fees for electrical, plumbing, and mechanical work are also detailed in the document.

The impact of the pandemic on the region is expected to wind down over the course of the year. More affordable housing projects are also still expected to be built in the area.

Los Angeles and Orange County

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The architecture of Los Angeles was heavily influenced by Hollywood as residential development began when film companies moved to the area right before the “Roaring 20s.” Soon, many other industries also began to draw workers to the region, spurring its suburbanization. The varied styles of homes extend to Orange County, which is considered a part of the Los Angeles metropolitan area, closely linked to it by the Gateway Cities.

Depending on the style would-be homeowners would choose, whether American Colonial, Cape Cod, Cottage, Craftsman, Ranch, or modern, building a home in the area could start at around $200 to $275 per square foot. A more customized home in the mid-range would go for about $300 to $350 per square foot. Luxury homes go up to $375 and beyond.

Listings for land in Los Angeles average at just a little over $1.8 million, starting at $10,000 for 2,573 square feet in Beverly Glen Canyon going up to $47 million for 4.56 acres in lower Bel Air. In Orange County, the average is a little higher at $2.3 million, starting at $50,000 for 2,614 square feet going up to $12.9 million for half an acre in Monarch Bay.

Los Angeles real estate agent James Colin Campbell says the cost to hire an architect in Los Angeles tends to vary based on the architect’s experience and the size of the firm. Larger firms with more than 20 employees typically charge higher fees owing to having higher overhead costs and taking on larger or more high-end projects. Hourly rates can range between $100 to $200 while fees charged as a percentage of total construction costs would range between 10 to 20%. Flat fees can also be charged for more standardized projects where time and resources needed can be more easily defined. Costs for an architect in Orange County would also fall within this range.

Major Cities

Los Angeles

For those building in the city itself, the Los Angeles Department of Building and Safety charges permit fees depending on the size of the project ranging from $111 to $185 per square foot for new dwellings. Separate fee schedules reflect the costs of electrical permits, HVAC permits, plumbing permits, and grading plan check and permit fees.

Long Beach

Another popular city in this region is Long Beach, known for its waterfront environment. The City of Long Beach Development Services Building and Safety Bureau charges several fees for the building of homes in the area. 

Development Impact Fees are as follows:

    • Fire Facilities – $496 per dwelling unit
    • Parks & Recreation Facilities – $4,613.04 per dwelling unit
    • Police Facilities – $703 per dwelling
    • School – $4.08 per square foot
    • Sewer Capacity – $121.39
    • Transportation Improvements – $1,125 per dwelling unit
    • Offsite Runoff Mitigation – $3 per square foot

Building permit, fire permit, mechanical permit, electrical permit, and plumbing permit and plan check fees are determined based on the valuation of the project or the specific work that needs to be done, as reflected in the separate fee schedules.

Irvine

The master-planned city of Irvine in Orange County was formally incorporated in 1971. It has since become the headquarters for many tech companies and home to various higher education institutions.

The city’s building and safety fee schedule details the different charges imposed on new homes, including:

    • Code Permit Issuance – $48.40
    • Inspection – $0.374 per square foot
    • Model Plan Check – $0.520 per square foot
    • Production Plan Check – $0.044 per square foot

Since the pandemic has placed many residents in remote work set-ups, developers in Los Angeles are considering converting empty office spaces into housing. This is also true of other commercial spaces in the area as well as in Orange County, which are being transformed into or adding multifamily residential developments as the number of shoppers have also dwindled over the past two years.

San Diego-Imperial Region

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Offering the best of nature in both its sunny beaches and open park spaces as well as its world-famous zoo, San Diego has many times been regarded as one of the best places to live. Portions of the area bordering the Mexican state of Baja California were also the most recent to be established as a county, the Imperial County, which stands out from the rest of the state with sand dunes and canyons across its desert landscape. Together, they make up the bottommost region of California.

Considering both counties, building a home in the San Diego-Imperial region would cost a fairly competitive price alongside the rest of the state, starting at about $200 per square foot. A more customized home in the mid-range would cost between $375 to $500 per square foot, while luxury homes would start at $500 per square foot and beyond.

The cost of custom home design development in the area would range between 5 to 8% of the total cost to build the home. This would include programming, conceptual design, design development, 3D renderings, construction documents, Title 24 compliance, interior design, product selection, structural engineering, and all other coordination.

Major City

San Diego

The city of San Diego attracts both millennials and families with its opportunities for higher education and recreation. For this reason, the cost of building in the city itself is higher than in the rest of the region, averaging in the $375-$500 per square foot range. Installing an asphalt roof in the area for a 1,000 to 3,500-square-foot home would range between $4,600 to $27,000 depending on the company and materials chosen.

The County of San Diego Planning and Development Services Building Construction Fee Schedule indicates that the plan review for a single family dwelling is $1,863 plus $0.288 per square foot, while the permit fee is $1,953 plus $0.170 per square foot. Electrical, plumbing, and mechanical permits cost $562. City fees would usually range between $30,000 to $50,000 including park and recreation, green, seismic, drainage, fire, sewer, water meter, traffic impact, and school fees.

What Leading Custom Home Builders and Architects that Serve California Say

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Contractors and architects serving the state say the cost to build a house in California has been volatile even before the pandemic, but they tend to trend one way — up. Jim Zack, principal of Bay Area-based Zack | de Vito Architecture + Construction shares, “Even in the Great Recession, it seemed that relative to other places, even though work was scarce, prices were more flat than down. Subs did lower prices, and mark-ups were also down, but land, materials, permits, etc. were all the same.” He further explains, “Since 2010 we have seen 4-10% cost increases virtually every year, which is a doubling in costs over 10 years. There is far too much money and not enough property in Northern California, so the upward process pressure is extreme and constant.”

Zack continues to say that the biggest issue they face today is labor, and this has impacted every level of the construction process. “We can’t hire good design staff: the building and planning departments seem to be shedding staff weekly. Thus, approvals take longer and are more complicated, construction staff is hard to find, subs are too busy and short-staffed, supply chain issues are real, etc.” Thus, Zack advises clients: “Don’t try to wait out the current high costs; they will be higher next year. With the current inflation and last year’s crazy spike in lumber, costs will keep going up, and even if there are anomalous market forces leading to current spikes, I doubt prices will go down.”

John Dorr, president of fellow Bay Area-based firm DomA Architects, also advises project owners to be patient and committed to their project. “We are seeing that everyone in our industry is very busy right now. Short of a full war in Europe, we don’t see things slowing down for quite some time. We currently have a backlog of work for three + years.” John continues explaining that like others, they have also seen a steady uptick in construction costs during and post the COVID-19 pandemic, with one factor being the manufacturing and shipping delays in the materials supply chain.

For Andrew Skurman, founder of San Francisco-based Skurman Architects, it would be good for would-be homeowners on a budget to find housing that doesn’t need much upgrading, owing to the uncertainty of what increasing labor rates and high inflation combined with supply chain issues will do to construction pricing in the future.

However, for those who decide to still build from scratch, construction industry veteran Fernando Mata, founder of La Aldea Construction, recommends homeowners talk with their architects about their allowances before finalizing the home’s design and finish materials. “Due to the recent price surge  and demand for materials, the cost of materials has gone up dramatically. Now you are spending double the cost on framing and foundation work compared to 3 years ago,” he explains.

The Future of California’s Residential Construction Industry

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Homelessness has been a constant problem in California due to its ever-growing population. The passage of Senate Bill 9 aims to help alleviate the housing shortage by allowing the creation of more homes on existing residential lots across its different districts. However, some are doubtful that the bill will achieve this goal. With some areas already pushing back on the law, widespread implementation has yet to be seen, and even so may still come up short of the required number of housing units.

The multifamily residential sector does remain strong in the midst of rising rent prices. Alongside this, more affordable housing is also being built across the different regions. 

Still, backlogs of projects that were put on hold due to supply chain disruptions and other effects of the pandemic are projected to keep builders busy over this year, with the number of construction projects of single family homes rising 34% above the previous year. In addition, the Urban Land Institute (ULI) includes San Diego, Orange County, the Inland Empire, and Los Angeles among its list of the top 20 markets with the best real estate prospects in 2022.

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