US construction costs make up 65% of single-family home prices, the highest since 1990s

Posted on February 19, 2025   |  

Construction costs now make up 64.4% of a single-family home’s price, the highest share since the late 1990s. 

Lot costs account for 13.7%, while builder profits remain at 11.0%.

Timber frame and truss costs have gone down over the past 30 years due to smaller home sizes, even as labor and site work costs have increased.

The average single-family home size in 2024 is 2,647 square feet, up 86 square feet from 2022 but still below pre-2022 levels.

Home sizes peaked at 2,802 square feet in 2015, then dropped to 2,776 sq. ft. in 2017, 2,594 sq. ft. in 2019, and 2,561 sq. ft. in 2022, before slightly increasing in 2024.

During the Great Recession, home sizes shrank, falling from 2,716 square feet in 2009 to 2,311 square feet in 2011, as demand slowed.

The average construction cost of a single-family home reached $428,215 ($162 per square foot) in 2024, the highest ever recorded. 

In past years, it was $80 per sq. ft. in 2011, $95 in 2013, $103 in 2015, $86 in 2017, $114 in 2019, and $153 in 2022.

Construction costs have steadily increased, pushing home prices higher, while home sizes have changed over time.