How much does it cost to build a house in Michigan?

Reviewed by Adam Graham remodeling expert. Written by Fixr.com.

The low costs of living, job growth, and natural resources make Michigan one of the best places to live in the U.S. Because Michigan has some of the lowest costs to build a house in the U.S., it is one of the best places to build for first-time homeowners. Because of this, the new home construction industry in Michigan has been steadily rising in the past few years. If you want to relocate to Michigan and build your own home, you should consider some things. Several costs are involved in the process, such as building permits, materials, labor, and amenities like plumbing and electricity. The costs vary drastically based on the type and style of home and from one city to another, so it is important to research the market to ensure you get the best deal.

The national average cost to build a home in Michigan is $190,000 to $260,000. Most people pay around $220,000 to build a three-bedroom, 2,000 sq.ft. stick-built Colonial-style home. At the low end of the spectrum, an 800 sq.ft. one-story modular ranch house costs $56,000. At the high end, you can pay up to $850,000 to build a 5,000 sq.ft. luxury Craftsman home with custom features.

Average Cost to Build a House in Michigan

Average Cost to Build a House in Michigan by Type

Depending on the type of house you want to build in Michigan, expect the average costs to range between $70 and $120 per sq.ft. for a modular home and $90 to $150 per sq.ft. for a stick-built house. In Michigan, the most common house type, comprising around 90% of the new constructions, is a stick-built home. Even though they are not very common statewide, rural and northern Michigan have the highest concentration of modular homes. The main difference between a modular and a stick-built home is that most pieces for modular homes are built off-site and then assembled on-site. With stick-built homes, the whole house building process is done at the construction area. The quality of materials and duration of the home is the same. However, modular homes are limited in customization options, while stick-built homes can be fully customized.

Cost per Square Foot to Build a House in Michigan

The cost to build a house in Michigan is $70 to $150 per sq.ft. The average house size is 2,000 sq.ft. Size is a factor that significantly impacts the overall house building cost in Michigan. The bigger the home is, the more materials and labor required to build it. The average cost includes the labor and materials needed to build the home, but the exact cost depends on the type and style of the home, its layout, and the contractor prices.

Average Price to Build a House in Michigan by Number of Bedrooms

Depending on the number of bedrooms, the average house in Michigan costs $45,500 to $480,000 for a modular house and $54,000 to $600,000 for a stick-built house. If the house has multiple bedrooms, more materials and labor will be spent on the house, which raises the total building cost. Most homes in Michigan have two or three bedrooms, depending on the layout, but the number of bedrooms varies. The table below illustrates how much you can expect to spend to build a house in Michigan based on the number of bedrooms.

Cost to Build a Home in Michigan by Number of Stories

Building a home in Michigan based on the number of stories costs $140,000 to $220,000 for a one-story home and up to $220,000 to $360,000 for a three-story home. Most homes in Michigan have one or two stories, which do not typically require special machinery to construct. However, depending on the size of the home, it may be less expensive to build upwards to two stories than to expand a 2,000 sq.ft. house on a single level. Construction companies must use more advanced machinery and equipment to build the higher stories, so the cost increases as you go higher than two stories. The table below illustrates the average cost of a 2,000 sq.ft. house in Michigan based on the number of stories.

Price to Build a House in Michigan by Style

With various styles to choose from in Michigan, the average cost ranges from $28,000 to $290,000 for a modular home and $30,000 to $400,000 for a 2,000 sq.ft. stick-built home. The cost to build a tiny house in Michigan is $28,000, which is the cheapest house style but can go up to $400,000 for a contemporary stick-built custom house. The architecture varies from city to city, but the most common house style in Michigan is Bungalow, followed by Prairie-style homes. Different building materials are required to build different styles of homes, so the cost to build a cabin in Michigan will be different than the cost to build a ranch house in Michigan. The table below shows the average costs of building a 2,000 sq.ft. house in Michigan with each style.

Home Building Cost Breakdown (Michigan)

Several things contribute to the average cost of building a house in Michigan. You need to prepare the land where the house will be located, lay the foundation, add the framing and roof, install the major systems of the home, and finish the exterior and interior of the house. Without these steps, the house would not be complete. While the costs below depict the average prices, the exact costs vary depending on the region where you build. Here is how much each category contributes to the overall cost of building a house in Michigan.

Labor Cost to Build a House in Michigan

Labor comprises about 40% of the total cost of building a house in Michigan, which translates to $28 to $60 per sq.ft. or $56,000 to $120,000 of the average cost. Depending on the house you want to build, you will need different types of professionals throughout the process. Each of these professionals charges a different hourly rate. Labor rates vary from one region to another. Always get multiple estimates to ensure you get the best deal in your area. The table below shows the average hourly rates in Michigan for the most common types of professionals you will need throughout the house building process.

How Much Are Building Permits in Michigan?

To start house construction in Michigan, you must obtain a building permit, usually costing $1,000 to $2,000. The building permit cost depends on the construction value of the house, which is determined by the construction type, use group, and gross area. Every city has a different fee formula they use for each use group. In addition to the building permit, an electrical permit of $10 to $500, a mechanical permit costing $50 to $100, a plumbing permit costing $50 to $500, and an HVAC permit with a $250 to $400 fee are needed. If you want to add a fireplace, water heater, or a pool heater, they require a separate permit. An initial inspection is included in the basic permit fee, but every additional one costs $100 each.

The building permit in Michigan can be obtained by the structure’s owner or the owner's builder, architect, engineer, or agent. To apply for a building permit in Michigan, the full set of construction documents, special inspection, and structural programs need to be submitted to the Bureau of Construction Codes. This documentation includes two sets of specifications for the structure and complete copies of the plans. These documents need to be sealed and signed by an architect or professional engineer if the property is bigger than 3,500 sq.ft. A site plan showing the dimensions and the location of the structure and the other structures on the same premises may also be needed.

Building vs Buying a House in Michigan

When moving to Michigan, you can either build a house or buy an existing one. In most areas, it is cheaper to build a house in Michigan than buy one. Some areas like Detroit, however, have lower prices for existing houses than other cities. When building a home, the first thing you need is land. Luckily, land is plentiful in Michigan. If the weather permits, it usually takes around six months to complete the construction of a house in Michigan.

When you decide to buy a house, the location is a major factor in the options you get. Houses in Detroit are smaller and less expensive, so there are more options. Many old constructions and abandoned buildings can be purchased. They require demolishing before you can build a new house on the lot. Areas like Ann Arbor and Grand Rapids have more spacious and updated homes, but they have higher sale prices.

Enhancement and Improvement Costs

Interior Designer

Depending on their expertise, hiring an interior designer in Michigan costs $50 to $200 per hour. An interior designer is helpful during the construction of the home because they help you figure out the layout of the rooms and the design of the home. They coordinate their work with the construction team to ensure the space will be used efficiently and the home is functional and aesthetically pleasing. During their work, interior designers follow building codes and inspection regulations and ensure that the area meets accessibility standards.

Additional Considerations and Costs

• Shipping container homes. The cost to buy a prefabricated shipping container home in Michigan ranges between $15,000 for a 20 ft. home and $50,000 for a 40 ft. container. Some custom-made container homes with luxury features can go up to $250,000. The container itself costs $1,400 to $2,800 for a 20 ft container and $3,400 to $4,500 if you buy a 40 ft container.
• Demo fees. If there is an old structure in the area where you want to build a new house in Michigan, you need to demolish it, which usually costs between $5,000 and $15,000, depending on its size. To do this, you need a separate demolition fee which ranges between $100 and $250 depending on the city and area.
• Inspection. An initial inspection of the construction is included in the building permit fee. If you hire additional ones, each one costs $100.
• Contingencies. Consider having a separate contingency budget of 10% to 15% of the house value. This budget makes up for unpredictable situations and ensures that the construction continues unhindered.
• Material shortages. The material supply channels have been disrupted due to the pandemic and conflicts, so there are sometimes material shortages. Before starting to build a house in Michigan, make sure that all materials you will need are readily available.
• Buy land. The cost of land in Michigan varies drastically depending on the area of interest. Buying undeveloped land in rural northern areas costs as low as $2,000 per acre. Buying in popular residential areas and waterfront land costs as much as $100,000 or more per acre.