This year, many homebuyers in Texas have an eye on a new construction property rather than an existing home. According to Fort Worth-based real estate agent Lily Moore, the average costs to build a house in Texas can actually make undertaking new construction the more affordable option right now.

“Building a house in Texas is still quite affordable compared to other states,” says Moore. “We don’t have state income tax, we have low property taxes — more people than ever are looking at new construction over existing homes.”

Moore adds that some Texas builders are offering low interest rates and closing cost incentives, providing real money-saving benefits for buyers who choose to build a new home.

As is always the case with real estate, pricing depends on everything from location to design preferences. But, on average, for an entry-level new construction home in Texas, Moore says that buyers can anticipate spending about $325,000 for a 1,600 or 1,700 square-foot house. She clarifies that this would be a new home purchased from a builder — otherwise known as a spec home or a tract home — which is the most common arrangement in Texas.

Comparatively, Moore says pricing on similarly sized existing homes is around $295,000 or $300,000 in the current market, and most of those homes were built in the 1980s and 90s. This means they are likely due for upgrades or repairs that will add additional costs — something you won’t have to worry about when building a new home.

For custom home pricing, Moore does admit that pricing will start considerably higher — around $700,000.

“It’s quite a big price difference, but it’s also for more space. Custom builds are typically no less than 2,600 square feet up to 5,000 square feet,” she says. “You’ll also have the benefit of getting more land if you buy through a custom builder, because the lots can be on half an acre or one acre.”

Variables aside, let’s take a closer look at the average costs to build a new home.