If housing prices are so high because of limited supply, why is it (usually) more expensive to build a home than to buy one?

Question

Shouldn’t it cost less? Is it to do with construction costs being high for unrelated reasons?

In: Economics

Answer 1

I have my own land and want to build an in law suite in the yard. Nothing extravagant, just a basic 1 bed, 1 bath, living room and kitchen kind of place around $700 sq ft. From what I’ve heard this will easily cost over $200k. I no longer believe it’s cheaper to build.