Some homes could be considered works of art. This long—but interesting—article, The Art of Building the Impossible, describes some of the construction challenges of building ultra-high end homes, town homes and condominiums. It gives us a view of the complexity involved when homes can cost $3,000.00 per sq. ft. Homes like the ones described in that article are a small percentage of the US housing stock, but they exist, along with other more prevalent high-value homes.
High-value homes are not just larger homes that can be valued by multiplying the material and quantity costs of a Mainstreet home to arrive at a higher number. High-value homes require builders with previous high-value home building experience. Typically, a greater variety of skilled trades are needed. More features and finishes are included with many that are not found in Mainstreet homes and some that are not easily sourced. Rooms would not only be larger, but they would also be more specialized. And then there is the location—one would expect many high-value homes to be found in locations that make the build more complicated and difficult.
Builders
Owners of high-value homes select builders that have the expertise to replace these homes. These builders may have worked on neighboring/similar homes and come highly recommended. These builders must have the experience and financial stability to build these types of homes. The owners will be selecting from a smaller, more experienced pool of builders and these builder’s costs will be higher.
Variety of Skilled Trades
In addition to all the usual trades—carpenters, plumbers, electricians, framers—specialized skilled workers and craftspeople would be needed. Depending upon the elements in the home, some skills might be difficult to source reliably without the experience that a high-value builder brings to the job.
Co-ordination of the many different skills on the job site is required. Understanding how each specialty fits into the overall schedule and how much time each task takes requires a knowledgeable builder.
More Features and Finishes
High-value homes not only typically have larger kitchens and baths, but they might also have more of them. For example, a kitchen on the main floor, one in the basement, a smaller one in a wing, perhaps an outdoor kitchen as well. Adjectives for the features and finishes for the home could be custom, unique, boutique, handmade, exclusive, imported, gilded, hand-forged, curved, built-in, exotic. Do you need convincing? Take a look at the most expensive home for sale in each state.
The article The economic goods approach to replacement costs provides a comparison of two homes: one average and one custom, and some of the differences that are found in each.
Specialized Rooms
Just as some builders are willing and able to rebuild vintage homes, the builders of high-value homes have more experience and need more skilled trades than those building Mainstreet homes. Tailored to the homeowner’s needs, rooms might be unique to that home—for example, card room, meat locker, art studio, recording studio, ballroom or more common high-value room types, such as media room, panic room, wine cellar and tasting room, game room, bowling alley and massage room.
Locations
High-value homes are often found in locations where there is lots of land (rural) or where there is a great view of the water (beachfront) or where there is privacy (on an island, in a gated community) or where there is a view of the mountains and valleys (remote). The locations make the rebuild more complicated since materials and labor must be brought in from a distance or may be restricted by ferry schedules or gated community rules.
High-value and ultra, high-value homes’ replacement costs involve more factors than the formula “material times quantity” can capture. Their replacement costs are not linear increases based on the replacement costs of average homes, but are the result of taking into account the different participants in this market.
The e2Value estimator tools were designed to handle homes of all sizes, ages and values, whether they are modest homes, museum quality homes or those in between. We understand these homes and provide the options necessary to value them accurately. Whether you are looking for valuations for high-value homes, Mainstreet® homes, condos, co-ops, commercial properties, manufactured homes, log cabins, or farms and ranches, our patented estimator can quickly calculate the cost of replacing a residential, commercial or farm structure and provide you with a fast, cost-effective and accurate replacement cost valuation. Contact us for more information.