If you’ve ever wondered if you’re better off building your own house to save on hefty house prices and mortgage fees, you should know one thing; building a house in Canada isn’t cheap.
Did you know Canada makes up about 6% of the Earth’s surface? That’s a lot of space if you ask us. It is also a bit of good news for anyone considering building a house in Canada. But what is the cost of building a house on the bountiful lands of Canada?
Where does your planning start? Have you acquired land? Are you permitted to buy and build on any land in Canada? In this piece, we review the known and hidden costs of building a house in Canada.
Building a House in Canada
Canada is a country that welcomes people from all over the globe, and in staying true to this, home and land buyers from all countries are welcome in Canada.
With its large space allocation, there is surplus land. And in some areas in Canada, these lands are being given away for free with the agreement that the new owner must develop them.
Building a house is a fascinating experience for anyone considering it. Building a home allows the homeowner unlimited freedom to design the house exactly how they want it. Also, they can pick the amenities and features they’ll like the place to have.
However, building a house in Canada is no child’s play; it can be quite expensive. So, to successfully carry out a building project, a homeowner must have the right budget.
If the funding available for the house construction is small, you might want to consider other options like renting or buying a house. Those who are financially capable of building a house in Canada still need to employ professional services to avoid wastage of resources.
As with acquiring anything in Canada, building a house in Canada depends on some variables including province, mortgage, building material, hiring building experts, architects, shipping material, and miscellaneous.
However, in Canada, there are cheaper options available to home builders. Depending on your budget, your home builder can get some of the building materials at a more affordable rate.
In replacement, you can use cheaper materials like wood, hire just a few construction specialists, and buy local building materials. You can also cut the labour cost by getting a helping hand or two from the beginning of the home project to the completion.
To successfully execute a home building project, a homeowner must account for any extra cost incurable when budgeting for their new home. Factors like the designs, features, and amenities, that is, how they will all create a perfect blend that matches the home owner’s style, should be considered when drafting the house sketch.
Building Options available to Homeowners
If you’re considering building your home, it’ll be wise to weigh your options, depending on your budget. You can either buy land to build on in Canada or buy a home from a developer.
The first option allows you to get the house of your dream. To accomplish this, you’ll need to employ an architect to design your home and have a builder complete the construction process.
For the second option, which is also known as “buying off-plan,” you might be restricted to specific designs or property sizes. But you can still choose fixtures, fittings, and some features to modify to your style. Check out our article on the best places to buy a house in Canada.
Finding a Land in Canada
To find land suitable to build your house, you can contact your local real estate and land agents. Give your agent the land specification you want and watch them work their magic. Alternatively, you can find land for sale online. Property developers are also an excellent way to get land in Canada.
And if perchance you come across a land you like and don’t know who owns it, you can contact the Provincial Land Registry office for the land. Note that there is a fee attached to checking land ownership in Canada. The price might differ depending on the province.
Factors to Consider when Buying Land in Canada
Once you’ve decided on the province, you can then set out to find land. The land you’ll be deciding on will depend on the view, rural/urban, amenities in the location, neighbours, etc.
Consider how building materials will get to the house, delivery cost, and other logistic analysis. Is the land linked to electricity, gas, internet service, sewerage, water, etc.? If it is not, then you will need to add it to your budget.
- Suitability of the land
Is the land suitable to build on? Will it be enough to build your dream house? Is the site sloped? These and many more are questions you should ask your land agent or anyone you’re procuring the land.
Levelling out a plot can be expensive, so you must check the water table; how wet the ground is will determine if you can build on it or not. Getting the right information on the plot before buying will save you a lot of money.
- Building Permit
Note that before you can commence construction on your land, you must obtain a building permit from the appropriate authority. Every building permit has a unique number, and the document must be visible on the construction site.
Your builder or architect will handle everything concerning obtaining a building permit for your building. If you are applying by yourself, you must submit all plans and designs for the construction.
The more complex the building designs, the longer the approval will be. There is a cost attached to the application for a building permit; it cost about 360 – 1,730CAD.
Regardless, there is no guarantee that your application will be approved. And if your building permit is not displayed when inspectors drop by, you’ll have to pay a fine.
- Is the land zoned?
Some land plots in Canada are under zones, which means they are subject to what you can build on. Buying a zoned land can affect where you can lay your construction, the kind of structure you can create, etc. Ensure to sort it out with your realtor before making a purchase.
Average Cost of Building a House in Canada
The average cost of building a house in Canada depends on the province in Canada you choose. Below is the price range per square foot of building a detached home in some areas in Canada.
Average Cost per Square Foot
125 – 195
125 – 195
90 – 150
Greater Toronto Area
140 – 240
105 – 175
110 – 145
120 – 200
110 – 210
120 – 185
145 – 265
Finding a Home Builder
A homeowner can avoid future problems by ensuring everything in the new home will work together correctly. To achieve your dream home, you’ll need to employ the service of a home builder. Picking a suitable builder for your home project can be a hassle, as you want to go for the best and most reliable.
You must ensure the company is used to the scope, size of the construction, and experience dealing with a home project like yours. Their portfolio and specialization should give you an insight into what they are capable of actualizing.
If you can, it is advisable to talk to other people who have used their services to evaluate their experience, the problems faced during the project, and how they managed the situation. Most reputable builders offer warranties; there are several home warranty organizations in each province where you can request a warranty report for free.
Ensure that any builder you chose to use is a member of the Canadian Home Builders’ Association and holds a building license for the province where you plan to build. You will also need a lawyer’s service to guide you through the legalities of buying land and building a home in Canada.
How Long does it take to Build a House in Canada?
How long your home projection will take will depend on the home builder you’ll be using – whether a conventioner builder, a custom home builder, or you might choose to buy a house.
- Conventional Home Builder
Depending on the type of home you want to build, it takes an average of 6 – 10 months for a conventional home builder to construct a new home for you. It takes about one month for the design department to get approval.
You or your builder will use the next 1 – 2 months to obtain relevant permits and permission from the city authorities. You can kick-start construction as soon as all plans and approvals are in place.
- Custom Builder
It takes an average of 12 – 14 months to complete a house building project for a custom builder. This duration is due to the extensive customization involved in a customized home.
If you are tight on the schedule to move into a new home, you can go for the quick possession option. Quick possession homes are homes readily available for buyers. If you are a new immigrant in Canada, check out our article on buying a house in Canada as a new immigrant.
The house could either still be in the construction phase to be finished in a short period or already completed. Here is a guide to buying a home in Ontario.
How to Build a House in Canada
Canada has its construction methods, and there are several types of houses you can build depending on your style. What kind of place do you want to construct? Is it a Condo or a Townhouse? Some of the housing styles in Canada include:
- Detached House
- Row House
Houses are built in Canada to withstand the Canadian climate using technologies that can ensure durability. Using wood is a standard practice in Canada; frames are made of wood, while concretes are used for foundations. Some houses are also built of brick, though they are majorly for facing material.
The duration to successfully execute a building project depends on the size, design features, and construction method. Note that the construction period can also be affected by inspection by local authorities.
Below are some of the steps involved in building a house in Canada:
- Set up a preliminary construction.
- Lay foundation
- Indoor and outdoor work
- Heating, plumbing, electrical and rough-ins
- Inspection – provincial
- Drywall, taping, and texturing
- Painting and cabinets installation
- HVAC, plumbing, and electrical installation
- Clean-up and final paint
- Final inspection
- Completion of Building
Is it cheaper to build or buy a house in Canada?
The simple answer? It’s cheaper to buy a house than to build one. First, Canada has a skilled labour shortage. To build a custom-made house, you will need highly paid, skilled professionals like architects, septic system engineers, carpenters, soil engineers, structural engineers, HVAC engineers, surveyors, etc. This costs a lot of money.
A detached home could set you back an average of $140 to $240 per square foot in the GTA or $145 to $265 per square foot in Vancouver, based on data for 2021. Costs have since soared. In fact, construction costs increased 7.5% in just the second quarter of 2021. Plus, costs might be much higher than the national average depending on the level of customization.
According to Stat Can’s aggregate index of the 11 major CMAs, construction costs increased the fastest in Calgary (+31.4%) and Ottawa (+28.4%), with Toronto and Edmonton tie in third place (+22.4%). The closest data to this was during the inflation of the early 1980s.
While considering monetary costs, you should also consider the emotional costs of building a house. Building a house isn’t as fun or as straightforward as it looks on HGTV, it is physically and emotionally draining. It’s important to ask yourself if you’re willing to invest that much.
Whatever structure or path you choose to become a homeowner, it is always advisable to have a real estate lawyer to guide you through the process. The homeowner has to sign various contracts, and a real estate lawyer will help you steer through the ever-changing real estate laws.