If you spent the past year dreaming of building a custom home, it’s time to create a roadmap to achieve your goal and surpass your wildest dreams. An important first step to creating a realistic game plan is to understand custom home pricing. While buyers purchasing pre-owned homes have the luxury of an immediately visible list price, buyers who plan to build their own custom homes need to understand several nuances that affect project costs.
Fortunately, those nuances don’t have to be abstruse. After decades of building and renovating homes in Toronto, we have an extensive understanding of the factors that influence the cost of your project. Without knowing anything else about the home you have in mind, we provide ranges and discuss the factors that impact costs so that you can better understand what your project might cost.
Factors that Influence the Cost of Your Custom Home
The Size of Your Home
The most obvious factor affecting your new home's overall cost is its size. Naturally, houses with more square footage are more expensive than houses with less square footage. The less frequently considered cost factor that still plays an important role is vertical space. As you consider architectural designs for your new home, be aware that ceiling height and interior volume also influence cost, simply because vaulted spaces require more materials and, in some cases, more careful planning.
Consider the Cost of Basement Construction
Space below grade is still finished square footage. Most custom homes in Toronto include basements. Our projects often include complete living spaces with kitchens, bathrooms, gyms, offices, and more. When considering the cost of building your luxury custom home, you must include the square footage in your basement in your rough cost-per-square-foot calculation.
The Architecture
Likewise, it’s important to note that the uniqueness and complexity of your architectural design will play into the price of your home. If you want to build your home in a classic style, your price will be less. More resources will be required if you want to push the envelope and create a unique, intricate, or rarely executed architectural design.
The Quality of Materials
The materials used in your home also significantly affect its cost. For example, consider that a Calacatta marble slab costs about $180 per square foot, whereas a granite countertop might cost $50-$100 per square foot. Scale this up to a full kitchen countertop, and you’ll have a good picture of how individual material costs significantly affect the overall price of your custom home.
Luxury Finishes
In the same way, the number of luxury finishes you incorporate into your home will influence its cost. If you opt to include luxury finishes on your home’s exterior and in the heart of the home but select simpler options for your basement and bedrooms, for example, your overall cost will be lower. As you plan your home, be sure to prioritize the areas that are the most important to you. Perhaps you’d rather have a wine cellar and an outdoor kitchen than a wet bar in your master bath, for example. You may have the budget to do all three, but knowing ahead of time which areas are the most important to you will help you plan and assess costs.
The Size and Location of the Lot
The size and location of your lot also influence your home cost because they inform the building process itself. More easily accessible homes are less expensive than remote homes that are hard to transport materials to or present engineering challenges.
The Depth of the Excavation
The deeper the excavation for your basement/foundation, the more expensive your home will be. Again, this factor affects the cost of both the building process and the materials needed for construction.
Toronto Luxury Custom Home Cost Estimates Per Square Foot
Let’s examine cost estimates per square foot with a built-in range representing the factors listed above. In the Toronto area, the average cost for high-end custom homes is between $400 and $550 per square foot. So, how does that translate to a custom home cost?
If, for example, you decide to build a smaller home measuring 3,300 square feet, your cost might range between $1,320,000 and $1,815,000 depending on architectural uniqueness and complexity, ceiling heights and interior volume, the quality of materials, the number of luxury finishes, the size and location of the lot, and the depth of the basement excavation.
If you prefer a larger home measuring 6,600 square feet, your cost might range between $2,640,000 and $3,630,000. And if you opt for a still larger home measuring 10,000 square feet, your home might range between $4,000,000 and $5,500,000, depending on the factors listed above. 
Toronto Custom Home Cost Trends
These 2025 custom home cost averages are meant to be a general guide and reflect current market trends at the time of publication. The cost of building a custom home has seen significant shifts over the past few years, largely driven by fluctuations in material prices and supply chain disruptions. Between 2019 and 2022, we experienced a dramatic increase of over 50% in construction costs due to global supply shortages and inflation. However, since early 2023, we've observed a stabilization, with prices increasing more gradually—closely aligned with inflation rates. While prices are no longer spiking as they did during the pandemic years, they remain at elevated levels compared to a decade ago.
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