Constructing an entirely new home on an empty plot of land is always a major undertaking. And when you’re building a nontraditional dwelling like a barndominium, the construction challenges take on a whole new dimension.
Yet barndominiums are so cool, so current, so wonderfully live-work-friendly, that many of us are willing to put in the extra work to construct our perfect home. And since new builds can be complicated, we decided to reach out to the experts for help.
So, before you begin drafting the master plan for your upcoming barndominium project, take a moment to consider these essential insights. Here are five key factors you’ll want to know before breaking ground and turning your dream barndominium into a reality.
1. Research your ZIP code
If you haven’t bought land yet, review each property deed for minimum square footage requirements and building type restrictions. You’ll also want to ensure your land is zoned for residential use.
The next step is to research the local laws and regulations surrounding new construction to ensure you can get the necessary permits to build your barndominium.
“As with any construction project, understanding local codes and zoning early on in the process could help reduce unexpected costs and headaches down the line,” says Jenny Shultzof the barndominium financing company Rural 1st.
Your local building department might also have restrictions on materials or finishes, such as siding, roofing, cladding, and facade treatments, allowed for use on a home’s exterior.
“If your build is within an HOA, make sure you’re in full compliance with their regulations as well,” says Shultz.
2. Look into financing
If you’ll need a loan, research your options early on. Since barndominiums are such a unique build, you’ll have an easier time nailing down financing if you can work with a lender experienced with this kind of construction.
“Some lenders may view barndominiums as a nontraditional construction project, so it may not qualify for a conventional loan,” says Shultz. “In some cases, a lender may only finance the construction portion of the loan and require you to refinance with another lender for your permanent mortgage once it’s built.”
Depending on the type of loan you get, you might also be required to undergo an appraisal process.
“If you are planning on doing a conventional or VA construction loan, you will need to ensure that the home will pass an appraisal for the loan,” says certified appraiser and real estate agent Candice Krasovec, who’s also building her own barndominium. “Otherwise, you’ll need to pay the difference between the loan and the appraisal once the home is completed and refinanced into a standard loan.”
3. Interview builders
Another thing to figure out in the early days of your planning is whether or not you’ll want to work with a builder. Hiring a builder is probably ideal if you don’t have any construction chops. And even if you are a DIY type, you might not be allowed to build your barndominium.
“Some states may permit the customer to be their own builder or general contractor, but others don’t,” says Shultz.
Another variable that might limit your ability to build the barndominium yourself is the kind of financing you’ve secured.
“If you are using a loan, then you will not be permitted to build it yourself,” says Krasovec.
If you can build the barndominium, you’ll likely still want to consult a builder or designer to decide what kind of home you’d like.
“There are two options when it comes to building a barndominium,” says Shultz. “You can either purchase a kit or design the build from scratch.”
While both methods work, a builder will help you decide the best fit for your project.
4. Plan for extra costs later
There are many pros to a barndominium, one being that barndominiums tend to be cheaper per square foot than traditional homes.
But that doesn’t mean these constructions are without their costs, and knowing how much your build will be (both upfront and down the line) can help you avoid any unexpected expenses.
To give you an idea, a 2,000-square-foot barndominium typically costs between $130,000 and $320,000 to build, or $65 to $160 per square foot. Although this is slightly lower than the average cost per square foot of an already built home, that doesn’t mean barndominiums are a bargain.
“The exterior is cheaper,” says Krasovec. “However, the interior costs do add up when you start factoring flooring per square foot, windows, cabinets, drywall, and the walls for the interior—which are likely much taller and more expensive to build.”
5. Consider insurance
Although homeowners insurance typically comes into play much later, it’s vital to ensure your new build will meet the criteria for future coverage.
Since many barndominiums are considered mixed-use, such as home and work or storage space, traditional insurance might not cover them.
“You may have to find insurers specifically offering barndominium coverage and read the policies to understand what’s covered, as they may vary by carrier,” says Shultz. “Typically, you can get coverage ranging from the actual cash value of the property to replacement costs and extended value policies.”
