Building Costs Per Square Foot in the State of North Carolina, USA

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Newly-built 3-bedroom house with 2 bathrooms and 2 car garages, completed in 2022, gross floor area 1,745 sqft - Located on 4085 Needham Rd, Bailey, NC 27807 Price $329,000

Newly-built 3-bedroom house with 2 bathrooms and 2 car garages, completed
in 2022, gross floor area 1,745 sqft – Located on 4085 Needham Rd, Bailey,
NC 27807  – Price $329,000

North Carolina Construction Market Analysis

Building costs in the state of North Carolina are 4% lower than the national average, and equivalent to the states of Alabama, Arizona, Georgia, Kentucky and Virginia. The top 10 biggest projects in North Carolina contributed $24.643 billion to the state GDP.

According to Cumming Report, annual construction volume in North Carolina grew by 2.7% in 2017, dropped by -1.7% in 2018, bounced back by a record 7.2% in 2019 and was 5.1% in 2020. A decline of -7.9% was forecasted in 2021, shrinking by -0.6% in 2022 and gaining 0.5% in 2023. This construction volume is an aggregate sum of residential, commercial, educational, healthcare, manufacturing, infrastructure and other structures.

The volume of residential construction constituted the highest amount at around 50% to 58% from 2016 to 2020, as well as in the forecasted period 2021 to 2023. The year 2020 had the highest volume of residential projects during this historical period. Infrastructure projects contributed the second highest volume at 23.8% of the total volume, followed by commercial projects at 9.5%. Educational facilities were in fifth place, followed by healthcare and manufacturing which contributed the lowest amount to the annual volume.

The Cumming Chart shows the historical construction spending index in North Carolina from 2013 to 2020, projected to 2024. The index was below the national average from 2013 to mid-2017, starting at 1 and ending at 1.26, after which it intercepted and hovered above the national average until the projected period ending in 2024. It climbed to its highest ever over the decade, reaching a record value of 1.38 in 2020. It’s projected to decline to 1.28 in 2022 and remain steady until 2024.

The Cumming Chart shows the historical trend between the amount of construction work and the availability of labour from 2013 to 2021. The amount of construction work was higher than labour needs in January 2013 to May 2013, Q2-2014 to Q1-2017, and mid-2019 to 2021, meaning there was a shortage of labour in the construction industry during these periods. On the other hand, there was a shortage of construction work outside these periods. Construction volume declined by -1.5% in Q1-2014 whereas labour increased by 4.8%. In 2015, the amount of work increased by 12.9% and labour decreased by 5.7%. Work declined to 9.3% in 2016 and labour increased by 5.8%. Construction volume declined by 4% in 2017 and labour increased by 6.7%. Labour needs remained higher than the amount of work available until mid-2019. In 2019, the volume of work declined by -1.7% and labour needs remained higher at 3.3%. The volume of work increased by 7.2% in 2020 and labour declined by 1.4%. At the beginning of 2021, construction work declined by 5.1% and labour increased by the same percentage.

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In 2021, 33% of North Carolina contractors surveyed in the AGC Sage Construction Outlook Survey expected the value of multi-residential housing projects to increase and the same number expected it to decrease and remain the same. However, more contractors expected the value of warehouse and water/sewer reticulation projects to decrease.

In power, healthcare support services, highway and bridge construction, a large percentage of contractors expected the value of projects to increase.

In the field of transportation, hospitals and civil service building, more contractors expected the value of projects to decrease. In manufacturing, federal and office building, a substantial number of contractors expected the total value of projects to decrease.

In K-12 educational facilities, tertiary education, hospitality and retail building, the majority of contractors expected the value of work to decrease.

The FRED Chart shows the historical house price index in Raleigh-Cary, North Carolina, from Q4-1977 to Q4-2021. The house price index has been steadily rising along a gentle slope during this 43-year period. Starting at 38.83 in Q4-1977, it climbed to 72.88 in Q4-1985, reached 82.96 in Q4-1990, climbed to 103.53 in 1995, rose to 124.53 in Q4-2000. The climb continued to 147.38 in Q4-2005, rose to 166.55 in Q4-2008 and then declined to 150.93 in Q2-2012, which was the first decline in 43 years. It resumed its upward trajectory over the next decade, rising to 236.25 in Q1-2021. It climbed even further, this time up a very steep slope to 286.35 in Q4-2021.

The average house price in North Carolina is $215,000, and there are 3,947,070 residential dwellings in this state. A large percentage of homes (36.2%) are on the affordable side, priced at $133,492 to $267,000. The second most popular homes (18.5%) are on the high-end, priced at $267,001 to $400,517. The third most popular choice are homes on the low-end, priced at $66,760 to $133,491. Luxury homes ($400,518+) are fewer as the price goes up (9.1% and below). Minimum-standard homes ($66,760 -) are also fewer as the price goes down (8.4% and below).

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The home appreciation rate in North Carolina has been positive over the period Q1-2000 to Q3-2021, rising by 65.57% from Q3-2011 to Q3-2021, 46.90% from Q3-2016 to Q3-2021 and 24.87% from Q3-2019 to Q3-2021. The annual percentage rise in the appreciation rate was 18.24% in the 12 months from Q3-2020 to Q3-2021.

63.5% of people in North Carolina own their homes, 36.5% are renting and 14.3% are in possession of vacant land. 26.7% of homes in the state were built in 2000 or later. 48.9% were built in the period 1970 to 1999 and 19.3% were built in the period 1940 to 1969. Single-family homes are the most popular type of residential dwellings in North Carolina. 65.1% of homes in the state are single-family homes. The second most popular dwellings are apartment complexes at 13.1%, followed by mobile homes at 12.8%. Townhouses and small apartments comprise the smallest number at 4.1% and 4.8% respectively.

Three-bedroom homes are the most popular size in North Carolina at 47.3%, followed by 2-bedroom homes (25.1%), 4-bedroom houses (15.4%), 1-bedroom houses (6.7%), 5+ bedroom homes (3.9%) and studio apartments at 1.6%.

Interest rates were down in the middle of 2021, but the ever increasing price of homes as shown by the historical home appreciation index is not exciting news for home buyers. According to date released by the NAR (National Association of Realtors) in Q4-2021, the top 30 cheapest places to buy a home in North Carolina in ascending order are Robeson County, Bertie County, Richmond County, Northampton County, Edgecombe County, Washington County, Scotland County, Halifax County, Greene County, Hertford County, Columbus County, Jones County, Sampson County, Duplin County, Anson County, Martin County, Warren County, Bladen County, Lenoir County, Vance County, Caswell County, Rockingham County, Tyrrell County, Wayne County, Montgomery County, McDowell County, Person County, Graham County, Rutherford County and Nash County.

Robeson County is the cheapest place to buy a home at $78,300 and Nash County is the 30th cheapest at $136,100. In the middle of the road is Anson County at $97,600, which is the 15th cheapest in North Carolina. The 7th cheapest is Scotland County at $90,900 and the 22nd cheapest is Rockingham County at $120,700.

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The average price of a home in Raleigh is $470,280 and $352,336 in Charlotte.

Some of the proposed new residential housing projects in North Carolina include the Middleburg Communities mixed-use development comprising 300 residential units to be built over the current location of the Knights Inn Motel. The complex design will include 39 townhouses separated from  274 apartment units spread out in 4 x 4-storey buildings. In the centre of the apartment complex, a courtyard will be built and adjacent to the residential area will be 7,500 ft2 of commercial space. This development will be an extension of a 600-home residential project that is currently underway in the same area. Two more projects by Middleburg in the same area are in the works, 283 housing units which have already been approved and 365 units which are still in the planning phase.

Building Costs Per Square Foot for Single Family Homes in the State of North Carolina, USA

Class 1 – Luxury Single Family Homes

The building cost per square foot for luxury private homes in North Carolina ranges from $331.09 per sqft to $507.55 per sqft, with the average being $390.74 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 1 Luxury Single Family Homes Building Costs NORTH CAROLINA

Class 1 Luxury Single Family Homes Building Costs NORTH CAROLINA

Class 2 – Semi Luxury Single Family Homes

The building cost per square foot for semi-luxury private homes in North Carolina ranges from $201.23 per sqft to $308.45 per sqft, with the average being $237.47 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 2 Semi-Luxury Single Family Homes Building Costs NORTH CAROLINA

Class 2 Semi-Luxury Single Family Homes Building Costs NORTH CAROLINA

Class 3 – Best Standard Single Family Homes

The building cost per square foot for best-standard private homes in North Carolina ranges from $130.08 per sqft to $197.58 per sqft, with the average being $152.30 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 3 Best-Standard Single Family Homes Building Costs NORTH CAROLINA

Class 3 Best-Standard Single Family Homes Building Costs NORTH CAROLINA

Class 4 – Good Standard Single Family Homes

The building cost per square foot for good-standard private homes in North Carolina ranges from $94.93 per sqft to $145.58 per sqft, with the average being $112.04 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 4 Good-Standard Single Family Homes Building Costs NORTH CAROLINA

Class 4 Good-Standard Single Family Homes Building Costs NORTH CAROLINA

Class 5 – Average Standard Single Family Homes

The building cost per square foot for average-standard private homes in North Carolina ranges from $77.06 per sqft to $118.01 per sqft, with the average being $90.87 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 5 Average-Standard Single Family Homes Building Costs NORTH CAROLINA

Class 5 Average-Standard Single Family Homes Building Costs NORTH CAROLINA

Class 6 – Minimum Standard Single Family Homes

The building cost per square foot for minimum-standard private homes in North Carolina ranges from $60.78 per sqft to $93.16 per sqft, with the average being $71.70 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 6 Minimum-Standard Single Family Homes Building Costs NORTH CAROLINA

Class 6 Minimum-Standard Single Family Homes Building Costs NORTH CAROLINA

List of 13 Metropolitan Areas/Cities in North Carolina – Percentage Deviation of the City/Town Building Cost from the National Average ($X), in Descending Order:

There are 552 municipalities grouped into 100 counties in the state of North Carolina. The bar chart below indicates that building costs vary in each metro city/town. The construction cost per square foot in each of these metropolitan cities varies from the state and national average by a certain percentage based on the location factor also known as the local modifier.

The percentage deviation of building costs from the National Average for each metropolitan area in North Carolina is shown below.

If $X is the Average National Building Cost in the USA, then it will cost the following to build a residential property in each metro city/town in North Carolina:

North Carolina Average -4% (4% less than X)

  • Kinston 285 -9%
  • Elizabeth City 279 -8%
  • Hickory 286 -8%
  • Asheville 287-289 -7%
  • Rocky Mount 278 -7%
  • Fayetteville 283 -6%
  • Wilmington 284 -6%
  • Winston-Salem 270-273 -5%
  • Greensboro 274 -3%
  • Durham 277 0%
  • Goldsboro 275 0%
  • Raleigh 276 3%
  • Charlotte 280-282 7%

The Metropolitan Area List above as well as the Bar Graphs below shows that Kinston is the cheapest city to build a private home in the state of North Carolina, and Charlotte is the most expensive city to build a home. Building costs are -9% below the national average in Kinston and 7% above the national average in Charlotte.

Deviation of City Building Costs from National Average North Carolina - Alphabetical Order

Deviation of City Building Costs from National Average North Carolina – Alphabetical Order

Deviation of City Building Costs from National Average North Carolina - Ascending Costs

Deviation of City Building Costs from National Average North Carolina – Ascending Costs

Cheapest Places To Build in North Carolina:

Kinston is the cheapest to place to build at -9% below the national average, followed by Elizabeth City and Hickory at -8%. The third cheapest places are Asheville and Rocky Mount at -7% below the national average. The fourth cheapest cities to build a house are Fayetteville and Wilmington at -6% below the national average, followed by Winston-Salem at -5% below the national average. The sixth cheapest place to build is Greensboro at -3% below the national average. Building costs in the cities of Durham and Goldsboro resemble the national average.  The cost of building a home in Raleigh is 3% above the national average.

Expensive Places To Build in North Carolina:

If anything between 5% and 10% is considered expensive, then there are two such metropolitan areas in the state of North Carolina. Building a house in the city of Charlotte is 7% more than the national average.

More Expensive Places To Build in North Carolina:

If anything between 10% and 15% is considered more expensive, then there are no such metropolitan areas in state of North Carolina.

Very Expensive Places To Build in North Carolina

The most expensive places to build a house in the USA are those 15% above the national average. There are no such places in North Carolina.

North Carolina State Average Costs:

Private home building costs in the state of North Carolina are 4% below the national average. Building cost rates in the metropolitan areas of Winston-Salem and Greensboro are closer to the North Carolina state average by a deviation of 1%. Charlotte is the most expensive city to build a home in North Carolina, and the state of North Carolina is number 15 on the national ascending costs scale.

 


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