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

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Mesa sits in Maricopa county, Arizona. It is the largest suburban city in the United States based on population, and the third largest city in Arizona. As the first Autism Certified city in the U.S., Mesa offers a number of family-friendly activities. One such place is the Arizona Museum of Natural History which can be found in downtown Mesa. Other than attractions, hotels and restaurants that are also Autism-certified, the city also has an official autism travel guide and a certified sensory guide for people of every spectrum. With over 2,280 acres of park area, 66% of the city’s residents live within a 10-minute walking distance of a park, compared to the national average of 55%.

Mesa is also an up-and-coming data center, with the construction of the Elliot Road Technology Corridor. The area has approximately 1,000 acres of land available for development, and a portion is already claimed by some of the biggest tech companies in the world such as Apple and Google. The most recent addition to the pool is Facebook, which unveiled its plans to build a 960,000 square foot facility, worth $800 million, last August 2021. With this development, Mesa officials state that the existence of data centers in the city may urge other tech companies to branch out to the area.

Given the current developments and what the city has to offer, future homeowners may ask “how much does it cost to build a house in Mesa?”

The Cost of Building a Custom Home in Mesa City

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According to Morgan Taylor Homes, building a 2000-square-foot home in Arizona can cost anywhere from $170,000 to $480,000, with the average cost per square foot at $170. This can increase depending on the location and customization. Based on Zillow, the typical home value as of November 2021 is around $396,235. This value is seasonally-adjusted and includes only middle tier homes. Property values in the Phoenix-Mesa-Scottsdale Metro area, or more commonly known as the Phoenix Metropolitan area or the Valley, grew by 32.4% around November and it is expected to continue rising over the next 12 months. The current median home value in the area is $422,463.

The price of a new home varies with the labor and resources needed to construct it. It also includes costs such as architecture and design fees, permit fees, land fees, and other custom features. New home construction includes framing, foundation, plumbing, roofing, and flooring, most of which are factors that fluctuate in prices independently. All of these costs can be categorized into either soft or hard costs.

Hard Costs

The hard cost is anything that involves the physical structure of the house, which includes the materials, landscaping, labor, and even the total building cost. According to BuildZoom contractor bids, the cost of building a new home in Mesa starts at $143 per square foot for basic design and construction. Mid-range homes are around $152 to $195 per square foot, while high end homes are at $248 per square foot or more.

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 can vary greatly depending on the location and customization the client may want. MK Design and Build estimates that when constructing a single family home in Arizona, materials comprise about 30% to 50% of the total building cost, with labor consuming 30% to 60%.

For the exteriors, asphalt roofing in Mesa, Arizona can range from $3.40 to $5.90 per square foot. Exterior painting can cost around $1,600 to $4,000, and will depend on the size of the home, type of paint to be used, and home location. As for interiors, painting can cost anywhere from $1,000 to $2,000, which will vary with the number and size of the rooms within the home, type of paint to be used, and the time it took to finish the job. For Mesa, tile floor installation can cost around $2,950. Arizona is known for its temperatures and concerns with particulate matter, so using tile floors will be more convenient in the long run since tiles can keep the home cool on hot days, and make it easier to clean when dust gets inside the home. The state is also one of the active subterranean termite areas in North America, so choosing a non-wood type of flooring will save the homeowner from future repairs.

Mesa temperature ranges from 43°F to 106°F, with summers hot and dry, and receiving less than 10 inches of rain annually. Installing a Heating, Ventilation, and Air Conditioning (HVAC) system may be beneficial in the long run. HomeAdvisor states that a new split system, which is the most common type, may cost from $8,000 to $11,000:

Other than a good HVAC system, another way to beat the hot Arizona weather is by having a pool. According to HomeAdvisor, building a pool can cost from $13,105 to $39,220, while an inground pool can be anywhere from $20,133 to $64,000. Built-in 50-watt pool lights are between $100 and $300 although higher wattages are available.

Soft Costs

Soft costs are the expenses that go beyond the construction of the home, such as architectural design, land development fees, building permit fees, engineering fees, and other miscellaneous expenses.

Cost of the Land

In constructing your new home, getting the best lot is crucial for the process. Generally, prices may vary due to several factors like proximity from metropolitan areas, view, amenities, land topography and current development status. Approximately 22% of Mesa’s 170-square-mile land area is reserved for single-family use. The average listing price of Mesa lots in RedFin is $330,114.95, with the average cost per square foot at $10.30.

Permits and Other Fees

The Mesa City Government has recently opened its offices for face-to-face transactions, however, permit applications and plan reviews should be submitted online before proceeding with the payment. For residential construction, fees are based on the total project cost:

A non-refundable deposit is also required upon submitting the application, which shall also be calculated based on the total construction valuation. The deposit will be credited to the payment of associated permit fees.

Other than the basic permit fees, impact fees also need to be considered, such as the following:

Architecture and Design Fees

Architect and design fees vary with the size, scope, and complexity of a project. The needs or lifestyle of the client also contribute to the overall or final design. Some designs may be simple and straightforward, while some may require extensive research and attention to detail.

Architect fees can be based on the construction cost by percentage, around 5% to 15% of the total. According to HomeAdvisor, the typical range of architect fees in Arizona is from $2,816 to $6,353, with an average of $4,041. In addition, hiring a landscape architect may cost an extra $779.00 to $8,867.00 as per Manta’s report.

How do the custom home building costs in Mesa compare to other nearby cities?

The median home sale price in Mesa is $405,000, as of November this year. This price is close to the national average of $404,700 for the third quarter of the year. Redfin indicates that there is an upward trend of 24.8% year-over-year on the median sale price, while the inventory of ready to sell homes is down by 6.9% year over year. In total, it takes approximately 27 days for a house on the market to be sold. Mesa is considered as a very competitive market, with in demand homes getting sold at 4% higher than the list price. Mesa is also considered one of the two most accessible and affordable cities for millennials, and especially Gen Zs. It would cost a future Gen Z homeowner 8 years to pay for a 20% downpayment, if they were to save up 17% of a household income adding up to a minimum of $36,311.

Phoenix

New home construction in Phoenix costs anywhere between $172 and $213 per square foot, with high end homes going beyond at around $356 or more per square foot. A home with basic, cost-friendly construction and straightforward designs would cost around $230,000. According to BuildZoom permits, the average building cost for Phoenix is around $397,897.05, with the median sale price of homes at around $410,000 on RedFin, at +28.1% year over year. On average, houses in Phoenix get sold within 30 days, which is slower than Mesa. Similar to Mesa, Phoenix is considered very competitive, with in demand homes selling at 3% higher than the original listing price.

Scottsdale

Homes in Scottsdale have a median sale price of $717,500, which is +19.6% year over year according to RedFin. Home inventory is lower by 6.2% compared to the previous year, while it takes an average of 34 days before a home can be sold in the market. In demand homes can sell up to 2% higher than the listing price.

What Leading Custom Home Builders and Architects that Serve the Mesa Area Say

To give us more information on the housing market, we reached out to home builders and architects that serve Mesa to give us their insight regarding the current costs of residential construction.

Brad Leavitt, president of A Finer Touch (AFT) Construction, LLC, shares the current costs of constructing a custom home in the East Valley area. Basic homes cost around $250 per square foot, mid-range ones at $300, while high-end or luxury homes can cost around $400 or more per square foot. Leavitt also shares that permit applications and approval are taking two to three times longer than the previous years, with cities requiring more revisions than before. With the demand in remodels and new construction, the high prices and shortage of inventory for materials are prevalent, which also contribute to longer building timeframes.

The Future of Mesa’s Residential Construction Industry

These past few months, home prices in the Phoenix-Mesa-Scottsdale metro skyrocketed, reaching up to 30%. Buyers resorted to foregoing inspections, and even going above and beyond the listing price. According to previous trends in the housing market, there is usually less demand during the colder months, and this gives time for the inventory to catch up. The National Association of Realtors (NAR) survey, which includes more than 20 experts from the economic and housing industry, showed that the national median home-sale price is expected to increase by 5.7% next year. As for the Phoenix metro area, Zillow predicts that home prices will increase by 20.3% in the following year. According to the Greater Phoenix Blue Chip (GPBC) Construction Forecast, single family construction is expected to be stable in 2023. The current strong demand for single family homes and low inventory hiked up housing prices, and this is expected to continue, but at a slower pace due to product shortage and affordability concerns. Permits increased by almost 19% this year, and are predicted to increase around 2% more in 2022.