It takes a team of people to bring a construction project to life, including a lender, architect, homebuilder, material suppliers and government officials. Others may be involved as well, depending on the project.
 
LENDER
 
Many people who build a new home will borrow money from a bank, credit union or mortgage lender to fund their project.  The lender will decide what they can afford to borrow based on their monthly income, existing debt, anticipated home-related expenses, and credit score.  The lender will be interested in the value of the finished home because they don’t want to lend more than what the house can sell for.  They will want floor plans and elevations and will have the design of the prospective home appraised to determine its value. A lender will usually require that the borrower contribute a percentage of the cost of the home in the form of a down payment.
 
For an existing home, equity that has been built up may be borrowed against to fund remodeling or an addition to that home, in the form of a home equity loan.
 
Before approaching an architect or builder, it’s helpful to meet with a lender in order to know how much can be borrowed.
 
ARCHITECT
 
The architect will design your new home, remodel or addition and may also guide their client through the bidding and construction processes. 
 
HOMEBUILDER
 
The builder actually constructs the new home, remodel or addition.  The builder and their crew will likely do some of the work themselves but will also subcontract out parts of the job that they don’t have the in-house expertise to do.  Trades (subcontractors) that are frequently “subbed out” include concrete, cabinets and other millwork, electrical, plumbing and heating/cooling, as well as specialties such as sound or security systems.
 
The builder will have a contract with each of these subs, and the lender will likely require lien waivers from the builder, showing that the subs have been paid for their work. 
 
MATERIAL SUPPLIERS
 
The builder will typically have certain material suppliers that they like to work with. The homeowner will likely have little to no involvement with the supplier of materials such as trusses, lumber and sheathing but may work directly with suppliers of cabinets and counters, floor finishes, and plumbing fixtures, who may have showrooms where homeowners can view their products.
 
MUNICIPALITY, COUNTY AND STATE
 
The local municipality, county and state will also be involved in the project by way of ordinances and code requirements.  The municipality will usually have rules about what and where you can build on your property.  The county may have rules about private sewage systems, and building near flood plains, bodies of water or wetlands.  The state has mandatory building standards in the form of the Uniform Dwelling Code. Depending on the nature of your project, a building inspector may be required to inspect the project at certain stages of construction.
 
 
The project team may also include the following: 
 
INTERIOR DESIGNER
 
An interior designer can help with the selection of cabinets and countertops, flooring, tile, light fixtures, and plumbing fixtures  (although an architect may also help with these selections).  An interior designer can also help select and purchase furniture, window coverings, and paint colors.
 
LANDSCAPE ARCHITECT
 
A landscape architect is a specialist in the grounds surrounding the home.  They can help with the design of patios and other outdoor paving, trees, shrubs and flowers, decorative or retaining walls, outdoor lighting, and water features. 
 
STRUCTURAL ENGINEER
 
Depending on the structural complexity of a project, a structural engineer may be involved. They will usually be a subcontractor of the architect.
 
ENERGY MODELER / CONSULTANT
 
The services of an energy consultant may be included on projects where the client has a strong interest in energy efficiency.  The energy consultant can work with the architect and builder to suggest the best ways to build an energy-efficient home and may do energy modeling to predict the energy performance of a new home, possibly modeling different floor, wall and roof assemblies.
 

Unfortunately, there's no easy answer to that question.  Building costs can vary widely depending on the home design, materials and details used and even location.  Here is a Fine Homebuilding article I've found which does a great job of discussing some of the decisions which can affect the price of a new home.  It appeared in issue #259,  the Spring / Summer 2016 issue of Fine Homebuilding.

​If you're building in the country, don't forget to add the cost of a septic system and well as well as a driveway.
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If you're planning to borrow money to build an addition or remodel your existing home, it's a good idea to check with your lender early in the process to get an idea of what your options are and how much you can borrow.  

If your equity in your home is greater than the cost of the addition / remodel, you're in luck.  With a home equity loan or home equity line of credit, you may be able to borrow as much as 100% of your equity for your building project, although you will likely pay a higher interest rate if the loan to value is greater than 80%.  

If you don't have enough equity, you will probably need to take out a construction loan.  A construction loan typically has an adjustable rate while the project is being built and will be converted to a permanent mortgage once construction is complete.  During construction, you pay interest on the funds that have been paid out.  

For a construction loan, the lender will want to have a copy of the building plans, as well as your builder's bid to do the work.  An appraisal is the basis for determining how much you can borrow. An appraiser will estimate the value of your home with the planned changes.  Typically a homeowner can borrow up to 80% of the value of the improved home.  Appraisers will judge the home's value based on the sale price of "comparables" - other homes in the area which are similar in size and age and which have sold recently.  It may be difficult to find comparables that are very similar, particularly if the home is highly unique.  

Homeowners may find that they're not able to borrow as much as they had hoped.  Some improvements add very little to the appraised value of a home.  Adding square footage to a home by adding another bedroom will likely increase the value of the home, although not necessarily as much as the cost of the improvement.  By contrast, beautifying the inside of a home might add little, if anything to the appraised value.  Using more expensive finishes or higher quality details may have little effect on the appraised value, because the appraiser has likely never seen the inside of the homes used as comparables, and so he or she is judging value based mostly on size, age and number of rooms rather than construction quality.

Here are some common mistakes to avoid when you're planning an addition:

1.  IGNORING THE SHAPE AND STYLE OF THE EXISTING HOUSE:    An addition should be similar in proportions and style to the home it's being added on to (unless there is a conscious choice to make the addition look clearly different).  Sometimes this requires breaking the addition into smaller parts so that it doesn't overwhelm the house.   Height and rooflines of the existing house need to be considered as well.

2.  NOT CONSIDERING HOW DAYLIGHT WILL BE AFFECTED:  An addition can make adjacent spaces dark.  A room that was once warm and inviting may become dark and cold if an addition blocks existing windows.  

3.  THINKING THAT BIGGER IS BETTER:  There's a temptation to think that as long as you're adding on, you may as well "get your money's worth" by making it big.  It's better to design smart, not big.  Think about how the new space will be used and make it only as big as is necessary to meet your goals.  Consider how existing spaces may be repurposed to work with the addition.

4.  UNDERBUDGETING:  The cost per square foot of an addition is often higher than the cost per square foot of a new house, particularly if it involves structural changes to the existing house.  With any construction project, it's wise to assume that it will cost more than you think.  Decide which things are essential and which can be optional if the budget allows.  Include an additional 15 - 20% contingency for unexpected expenses.

5.  NOT CONSIDERING FLOW:  Think about how people will move from the existing house to the addition.  How open should the new and old spaces be to one another?  Where will furniture be placed?  Avoid chopping up rooms with too many doors, which makes furniture placement difficult.

I've just added a home planning guide to my website.  For most people, a home is the largest investment they'll ever make.  The 6-page Home Planning Guide takes some of the mystery out of designing a new home, addition or remodel.  It covers the following:

• The factors you need consider in the design of your new home, addition or remodel
  
• The characteristics of a successful addition
  
• Contractors and Schedules
  
• Zoning ordinances, building codes and covenants

Here's a link to the guide

Images of beautiful homes are everywhere:  on the internet, in home magazines, on television. We may see these beautiful things and want them for ourselves.  Unfortunately, we’re rarely given a sense of what they cost to build and may be unpleasantly surprised when we dig deeper.  

I think it’s only human nature that our wants are greater than our ability to pay for them.  No matter how large our budgets for a new home, addition or remodeling project, there will be things that we’d like to include but aren’t able or willing to pay for. 

If you’re thinking about remodeling an existing house or building a new one, consider these strategies for keeping costs in line with what you can afford:

1. Build no more than you’ll use regularly (for example, consider eliminating the formal living room and formal dining room, unless these are spaces that are an important part of your lifestyle).
2. Determine your priorities:  what is absolutely essential? what would be nice to have but could be eliminated if necessary?
3. Consider using expensive materials, such as stone, in limited amounts in places where you’ll be able to enjoy them every day, (for example, using stone on the fireplace in your family room, rather than on a chimney surround that’s barely visible from the ground).
4. Build what you like and will use, not what you think will increase your home’s resale value (how often will you use that mammoth whirlpool tub and fireplace that you’re considering for your master bathroom?)  This assumes that you’re not building with the intention of selling soon. 
5. Consider lavishing more money on spaces that are important to you, and being more frugal in spaces that are less important (for example, splurging on a special tile backsplash in the kitchen if you love to cook and do it often, but keeping things simple in the bedroom if you use it mostly for sleeping).

Sustainable or “green” building means reducing the negative impacts that our buildings have on our environment and on ourselves. 

According to Alex Wilson, founder of BuildingGreen.com, the top ten priorities in green building are:

1. Reduce energy use
2. Reduce water use
3. Ensure a healthy indoor environment
4. Reduce the need for driving
5. Build smaller and optimize materials use
6. Ensure durability and reuse existing buildings
7. Protect and restore the site
8. Use green materials
9. Create resilient, climate-adapted buildings
10. Make it easy for homeowners to be green 

Given the fact that fossil fuels are a major contributor to global warming, that world demand for those fossil fuels will eventually exceed easily-obtained supplies and that we are dependent on foreign countries for much of the energy we use, the most important thing we can do to make our buildings more sustainable is to design, build  and operate them to use less energy.  

Sustainable design requires a systems approach from the beginning of the design process - considering how the different parts of a building work together.  It is not a feature or two that are tacked on after the design is complete. The heart of an energy efficient home is a tight, well-insulated building envelope with high quality windows and doors, and efficient heating equipment, appliances and lighting. These measures require more care during construction and may add some small additional cost during construction but will save money over time in reduced energy bills.

If a homeowner is truly interested in sustainable building, it is important to work with a builder who has experience in building energy efficient homes or is willing to learn.  And finally, even the “greenest” home will waste energy if its occupants are not using it in a thoughtful way to save energy. 

It’s a shame that when we design and build our houses, we don’t give more thought to how we can make use of the assets and features that our building site presents us with.  It is common to orient a home to views, if one is lucky enough to have them, but it is less common to consider the effects of the sun, the wind, the topography, landscape features and vegetation.  

A home that is stretched out in the east-west direction, with windows on the south, can make use of passive solar heat gain in the winter.  Appropriately sized overhangs keep the sun out in the summer when it’s not wanted.  Even a home on a small lot can use its site to its advantage by putting the most-used spaces on the south side and reserving the north side for garages, bathrooms, storage and other utilitarian spaces.  This works best when the front or back of the lot faces south.   If developers designed subdivisions with the sun in mind, streets could be laid out so that every lot could have a sunny orientation. 

Putting windows on two sides of every room allows not only for better lighting of the space but also for cross-ventilation, which can be further enhanced by orienting windows toward the prevailing summer breezes.

When choosing a floorplan, it’s important to think about how it will fit onto one’s particular site, especially if the site is a sloping one, which is best suited to a multi-level home.  Think about how a car will approach the house, where the garage will sit, the route that visitors take from the driveway to the front door, which rooms should get the best views and the most sunlight, where decks and patios will be, and which rooms will have doors to the outside.  Think about features such as trees or rock outcroppings, and how the building will fit around these, perhaps using them as exterior focal points by placing windows so that these features are visible from important rooms in the house.