Is It Cheaper To Build Out Or Up?

Building a house requires you to invest a considerable amount of money. This is why you must take the time to consider the design and the features you want to have in your own house.

One of the considerations you need to make when choosing a design is whether to build a single-story or two-story house. Which one will suit your needs best? This is the most crucial question you need to ask yourself to determine which option to choose. However, the answer will depend on a large number of factors.

Building Up

Choosing to build a two-story house plan has many valuable benefits when it comes to cost and functionality. First, consider the cost. By stacking living space, you can add considerable square footage to your home without adding additional costs for roofing and foundation materials. The first level will not require roofing materials, and the second level will not require foundation materials. You can nearly double your living space while cutting costs on materials. (See Saving on Your Building Budget.)

The two-story house plan option also can save you money when choosing a lot. (See Selecting a Home Site.) In general, a two-story home requires less building space, often fitting on a narrow lot, compared to a rambling ranch house of the same square footage that will require a much broader lot. With a single story, the more living space you need, the larger the lot you will need, leading to a more expensive price tag for your property. Choosing to build a two-story house will help with budget savings when considering the piece of property you will need.

Building Out

Now that you have a better understanding of “building up,” take a little time to consider “building out.” There are many benefits to building a single story or ranch house when considering efficiency and functionality. While it may be more expensive to make a ranch home instead of a two-story of similar square footage, comfort and peace of mind may be well worth spending the extra money. Think about your daily activities. Most homeowners spend plenty of time cleaning, doing laundry and checking on their children. It may be more efficient in your eyes to build a single-story home. If you are working in your home office, you can quickly call the kids in the next room to check on them as you continue to type at the computer, instead of putting your work aside for a few minutes and taking a trip upstairs to see what the kids are up to. Do you want to haul the vacuum up the stairs to vacuum the bedrooms similarly? Do you want to be totally out of the kitchen range, putting folded laundry away while dinner is cooking? In some cases, living in a ranch home will make multi-tasking and daily chores simple and offer efficiency.

If you or someone living with you has physical limitations, a one-story house may be the best choice for you. Eliminating steps whenever possible allows these people to live more independently. It is a simple convenience with far-reaching benefits for them.

Move or Improve

Your decision to move to a new home or improve your existing home by increasing the square footage will depend on how well you like your current area. If the neighbourhood is inconvenient to shopping, dining and schools or the safety have decreased over the last few years, and your best option may be to move to find a better area. However, if you are happy in your neighbourhood, there may be few reasons to uproot and leave.

Another factor is the cost to move versus the cost to stay. It is estimated that it can take up to seven years to recoup the money when you move. If you don’t plan to stay in your new home for at least seven years, you may want to consider building onto your existing home rather than moving. After all, you can build any room you desire, or you can bump out existing exterior walls to create more space in your rooms. Common reasons to bump out the rear wall of a home include adding more kitchen and dining room space or increasing a family room size.

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Building Up or Out: What Each Involves

When it comes to expanding your home’s square footage, you can expand your home’s ground floor footprint. You can add a full or partial second story, and you can even add a full or partial third floor onto your two-story home. However, it’s essential to understand what’s involved when performing vertical and horizontal additions.

Vertical Additions

Vertical additions mean you are building up instead of out. This means that all or part of your home’s existing roof will be removed. Once the roof is off, you may want to consider staying in a hotel or with family members for the rest of the renovation due to the inability to heat or cool the home and use services like water supply, which may need to be turned off during the renovation process.

If your home only has a single story, expanding your home vertically will involve adding a staircase, which will occupy a portion of the first floor, thus reducing the amount of available square footage. If your first floor has enough space in front of the front door, you can put a staircase near the front door. If the foyer area of your home is already crowded, you can work with architects and designers to find a convenient location to put your new staircase.

Horizontal Additions

Horizontally expanding your home subtracts from the available space in your yard. However, if you don’t utilize your backyard often, this may be a great option when you consider you’ll have less grass and landscaping to maintain. Not to mention, horizontal additions aren’t as disruptive as second and third-floor additions because they typically occur outside of the home’s main rooms.

To build a horizontal addition, a foundation must be poured. Then, the walls are framed, and any needed plumbing and air ducts are added, and a roof is installed over the new addition. Horizontal additions must be placed and designed so that they flow with your existing floor plan, and the exterior siding or brick, as well as the roof, must be built so that it matches the existing exterior. Failure to reach the existing home with the new ground-level addition can result in a visual and functional disconnect between the house’s old and new portions.

Is It Cheaper To Build Up Or Out?

Some of the fees’ contributing factors here include the cost of labour and regulations for various construction types, for everything from building out to low-rise to high-rise construction. In some cases, wood frame construction is permitted, keeping costs lower, depending on the area of building and occupancy. However, wood frame construction is not allowed in areas requiring non-flammable construction, which increases costs. 

Cheaper to Build Up or Out

By building up rather than out, you add square footage to the building without increasing costs for foundation and roofing additional materials. Meaning you practically double (or multiply by however many floors you want) your occupation space. Of course, building up means you also save costs on the size of the lot you choose (significantly when expanding lots out may not be readily available). A great deal of vertical space can be fit when building up in a narrow lot space rather than building out, which means expanding often inexpensive commercial or not-for-sale property.

There are other advantages as well to building up rather than out. Building up allows contractors to customize entire floors more quickly if desired. That is, with less space, more companies can afford an entire floor to be fit to their liking, without worrying about having to share space with another company. Of course, any office space can be customized. However, smaller companies may find it more attractive not to share a floor. Also, separating offices by floors can be quieter for occupants than having more offices or stores side by side in a built-out scenario. Multi-story buildings might have more impressive exteriors size-wise than single-story, and landlords can charge additional signage fees (such as on the top of a multi-story office building). 

There are, however, some advantages to building out rather than up. For example, there is some attractiveness to being closer to the parking lot, particularly for businesses serving customers with disabilities. More can be done for higher or more attractive ceilings in single-story buildings rather than multi-storey, such as skylights or custom vaulted ceilings.

Generally, it is cheaper to build up than out. However, factors that can cost more in some vertical cases can be expanded elevator shafts and more complicated HVAC systems when building up. Over twenty-story buildings can impact the costs, as opposed to less than twenty-story buildings, due to these and additional factors.

Deciding Whether to Build Up or Build Out


Many people might immediately think that building a two-story house would be more expensive than a single-story. This may not always be the case. Deciding on building a two-level home allows you to build your dream home on a smaller lot, which can be more affordable. A two-story design will enable you to add considerable square footage to your home without the additional costs of roofing and foundation. Choosing to go with a single-story home can mean that you’ll need a considerably sized lot if you are planning to build a large house. Consider how much money you have in the bank and how much you are willing to borrow when deciding which floor plan to go for.


When deciding on your future home’s design, you’ll need to note the rooms and features you want to be included. If you were anticipating living with your elderly parents or in-laws, a single-level home without stairs would be more functional for the whole family. Having all rooms on the same floor also means gives everyone easy access to everything. If you want more flexibility, a two-level home would be perfect. Consider having the master bedroom on the first floor, planning on spending your golden years in the same house. Extra bedrooms and flexible space on the second floor will give everyone some privacy.

Accessing Your Family’s Needs

Your lifestyle should be one of the considerations you need to make when choosing between a single-story or two-story house plan. This also includes the size of your family as well as your children’s ages. For example, families with small kids usually want to have their bedrooms and bathrooms in one area, while those with teenagers wish to have separate rooms.

If your family likes to entertain, a single level home with an expansive foyer leading to open living space would be perfect.

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Why Should You Expand Your Home?

Ask any homeowner who’s currently doing an addition to their home, and they’ll probably give you a different reason for wanting their expansion. There’s no one-size-fits-all reason to expand a house. Some of the more popular reasons include:

  • Expanding the family: Many home addition projects get their start from having another child or deciding to switch to a multigenerational home. 
  • Increasing property value: Bigger homes are generally seen as more desirable and can command a more significant price tag.
  • Getting a home office: If you work out of your home, you might want to get a room that’s entirely dedicated to it. This is one of the few ways to make an expansion into a tax advantage for you.
  • As a treat: Sometimes, people want to expand their homes because they’ve always wanted a dedicated room for themselves. Who wouldn’t want their hobby room?
  • Keeping up with the neighbourhood: Let’s face it. No one wants to be the tiniest house on the block. If everyone else is expanding, it’s safe to say you might feel the pressure to do so, too. 

Why Is Building Up So Expensive?

It’s all about stability and safety. Simply put, it takes a lot more effort to make sure a home stays stable with several thousand pounds added on than it does to add another room on solid ground. Not all homes are sturdy enough to expand upwards without additional help, while there are no such concerns when building out. 

Extra Labor

Because building up means that you’re tacking on an extra room or two to your first floor, there’s a good chance that you may need to add structural support to keep your home stable. You will also need to have a structural engineer check out your home to see whether you will need to do any additional repairs. 

Moreover, it’s essential to realize that building up also means removing the roof and parts of the home that are already there. Since this is more involved than your typical outward move that may require demolishing a wall and removing siding, your labour costs will also increase.

Extra Materials

No matter what your extra room will be used for, there will be certain things that you will need to buy that wouldn’t be necessary for outward expansion. For example, a typical first-floor expansion will not need stairs, additional support beams, or materials that involve adding extra sturdiness to your flooring. 

When you have an upward expansion, you’re going to need those things. All you have to worry about with regular outward additions are the basics—like electrical wiring and plumbing. This makes building outward a lower-cost endeavour in most cases.

Permit Costs

No one likes to think about permits, but they have to be considered when working with a remodelling project. Since there is an inherent risk with building upwards, most cities will require additional permits and inspections to ensure that everything is safe. This, too, adds money to your price tag. 

Alternatives to Explore

Before adding any new space to your home through building a second story or making an addition, you may want to consider a few alternatives that utilize your existing building envelope. 

  • Convert attic: Many attic spaces have ceiling heights that would allow for bedrooms and bathrooms. If your home has room for stairwell access, this could be a viable option. 
  • Basement conversion: If you have an unfinished basement, consider remodelling it to add bedrooms, a rec room, or a home movie theatre. 
  • Bump-out: Bump-outs are small extensions to the home that “hang” from the existing house like a shelf on a bracket. Although they only add a few square feet (usually 3 feet deep, for a short width), it may be all you need to add a powder room or walk-in closet or expand the dining room. 
  • Garage Conversion: Garages are often partially finished spaces with electrical and drywall already installed. By removing the garage door, adding a sliding glass door, and completing the floor and other code requirements, you can add a family room or playroom. 
  • Sunroom: Sunrooms are considered unfinished spaces because they are unheated. However, a sunroom can create a wonderful place for a seasonal sitting room.

You are deciding to build horizontally or vertically will depend on your property size, your neighbourhood’s zoning laws and HOA requirements, the condition of your home, your specific needs and your budget. 

The good news is that we can help you determine which addition type is best for you and your family if you live in and around the Houston area. We offer complete design/build services that will help you understand what’s involved in your home renovation, how long it will take and what you can expect to spend on your addition.

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