What are the Soft Costs of Building Townhome?

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Houston townhouse floor plans for sale

When building a townhome in Houston, TX, there are many hard costs included in the price, but what are the soft costs of building a townhome? Whether you’re building using custom floor plans or stock floor plans, you’ll need to calculate both hard costs and soft costs to know what the total cost of building a townhouse is.

Hard costs are the things that can be easily accounted for such as materials, labor, the cost of the floor plans etc… Hard costs are the things that when added together can give you a rough estimate of the cost to build the townhome. In addition to hard costs, there are also soft costs to building a town home and some of these might not seem so obvious and can therefore be overlooked.

The soft costs of building a townhouse are less tangible than hard costs, and can add up quickly if you aren’t experienced in the art of budgeting a project. Generally speaking the soft costs begin to accrue before construction actually begins. Permits must be pulled, licensing, insurance, etc.. all need to be in place before ground can be broken. Additionally, soft costs can continue after construction has been completed – asset upkeep like building maintenance and association fees.

Here are some of the soft costs of building a new townhome:

Fees

Fees include architectural and design fees, inspection fees, accounting fees, banking fees. If there’s paperwork there’s a fee for it.

Permit costs

Like fees, there are the costs of the permits needed to start construction.  Permit costs are sometimes included in the construction costs if the general contractor pulls the permits. Check with the contractor to determine where these fees will be accrued.

Utility Connections

You’re going to need both electricity and water to build the home. Costs may be minimal if power and water lines are already in the area, or more substantial if lines need to be brought to the lot.

Taxes

Property taxes

Local and state taxes

LEED Certification

LEED, or Leadership in Energy & Environmental Design, is a green building certification program that recognizes best-in-class building strategies and practices. To receive LEED certification, building projects satisfy prerequisites and earn points to achieve different levels of certification.

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