The modern home design premium
The allure of modern homes is undeniable—clean lines, minimalist design, and innovative materials all contribute to their contemporary appeal. However, with this modern aesthetic often comes a higher price tag compared to traditional homes.
To put the premium into perspective, we ran a budget analysis for two single-story homes of similar size (3,500 sqft of conditioned area). One a traditional design and one a Modern Design. We are assuming that all other factors are the same (for example, the building site, utility costs, etc.). Below are the biggest contributors to delta in the price tag.
CAVEAT - Home designs and project-specific factors can cause construction budgets to vary widely. In this particular analysis, the modern design is coming in at ~$500/sqft. A home with modern features can certainly come in at a lower price point, but on the flip side, a complex design or small home could be at a significantly higher multiplier. This analysis is meant to be a data point comparing two arbitrary designs of different architectural styles.
Structural Framing is one of the larger contributing factors. Modern homes often have large expanses of windows and doors, which, along with other design details, typically require steel framing. In this analysis, the steel and other framing adjustments added approximately $100,000 to the budget.
Windows & Doors—This is the largest adder. Windows and doors are among the most expensive selection items in any home, but floor-to-ceiling windows are much more costly than standard-sized windows. Modern homes often have large slider units, and the garage doors would typically be upgraded as well. The adder for this group is roughly $120,000.
Roof & Gutters—Flat roofs are typical with modern designs. The waterproofing and materials (e.g., TPO) used to achieve this look are typically the most expensive roofing options. Additionally, the gutters are typically hidden and piped through the walls. Our calculation was an additional $15,000.
Masonry – Modern homes are often 100% masonry. But even the ones that are not, the additional mediums are generally expensive finishes (not Hardie siding). The added a premium of approximately $30,000.
Plumbing and Electrical – For this section, we are referring to upgraded plumbing and electrical fixtures. Not only do the materials cost more, but the labor for the installation can also be a contributing factor. For example, wall-hung toilets are not uncommon in modern homes. They require additional hardware in the walls and take considerably longer for the plumbers to install them. We’ve calculated a $20,000 adder for these items.
Interior Finishes—This section will be largely driven by homeowner selections. Drywall is often upgraded to a level 4 or 5 smooth finish. Trim details may require additional specialty materials and skilled trim labor. Upgraded cabinets, countertops, etc. For the purposes of this analysis, we are calculating a $25,000 adder, but it could certainly be much higher depending on the homeowner’s taste.
Builder Expenses – Lastly, the general expenses of the builder will be higher. Simply put, these types of homes take longer to build. Our calculations show $65,000 of additional cost.
In summary, the overall premium to build the modern design was approximately $400,000, a 30% premium over the traditional design. This is just one analysis of the cost premium. Every design is different, and there are certainly ways of achieving a modern aesthetic to varying degrees. But it is generally accepted in the construction industry that this style of home will be more expensive to build.
Below is a summary of our budget comparison.
