Location of the build, the complexity of the design, and the level of finishes are the three factors that determine most of the cost of a build. 400K might buy you a builder grade 2000 square foot simple tract home in some locations, or it might buy you a semi-custom 3000 square foot home in another. One simple two story 4000 square foot Colonial might cost one homeowner 350K, while that same square footage in one of the new wretched styled "house of a thousand gables and foundation jogs" might cost 600K in the same location. Carpet and oak floors and laminate counters are going to cost less than travertine and Brazillian walnut and granite counters.

Your money will go much further in buying an existing home right now than in building one. Be sure you have exhausted that possiblity first. Lots of people who have recently built have the home cost more than the bank is willing to lend, and thus have to bring more money to the closing in addition to the amount of downpayment that the bank will require. If you are on a tight budget, that can kabosh the entire plan right there.

Well I wouldn't think countertops and other finishes would be affected by squarefootage. I'm in the the south (Louisiana) and I haven't heard of anyone spending 400k on a 2000sqft home. Like I said earlier, in 2005 a member of the community that I'll be building, built his 5400sqft (4400 heated)home with a total loan of 320k. That included clearing his land of timber and brush and leveling it for the build. Maybe I'll have a more in-debth discussion with him about his process.

There is a big difference between the 200.00 a square foot you quote (that is subzero, marble, custom cabinets, high end trim, solid brass hardware, etc. - high end stuff), and under 60.00 a square foot, which you friend says he did. I have my doubts if that can be accomplished now - with inflation and the rise in cost of materials - and if it could, it would likely contain the cheapest of all materials.

By your example, using a GC would likely only add 10 percent to the build cost, bringing your friends cost from 59.00 a square foot to roughly 65.00 a square foot . . .

2005 was seven (7) years ago! The banks were also giving money away to anyone with a pulse and no income!

In my area you are looking at $300/sq.ft for nice (not luxury) finishes in new construction. You will have to buy a teardown because we don't have open land. Existing homes range between $350/sq.ft for a foreclosure/SS that needs work to $500/sq.ft for a nice move-in ready house. No bargains here, but you can negotiate a better deal on existing homes as there are some sellers who really need to sell/move.

You need to find a few local builders and tour any houses they might have under construction (I'll bet you won't see as many as in 2005!). Look at the finishes and options and have the builder give you their current prices.

One more thing to think of - it can be extremely hard if not impossible to get a loan when you are the GC. That was not true when your friend built. I would talk to some bankers and see if they will lend you money (that is if you are not planning on paying cash). This has derailed many people who hoped to GC their own builds in this tightened mortgage environment . . .