Thinking about building a custom home in East Tennessee? One of the first and most important questions homeowners ask is: How much will it cost? While the answer depends on a variety of factors — including location, lot conditions, square footage, and design features — we’re breaking down what you need to know to plan realistically and confidently.
Average Cost to Build a Custom Home in East Tennessee
In 2025, the average cost to build a custom home in East Tennessee typically ranges from $170 to $250 per square foot, depending on your choices and scope. That means a 2,200 sq. ft. home could fall between $374,000 and $550,000, not including the cost of land.
At Olson Custom Homes, our projects are tailored to meet your lifestyle and budget — whether you’re building a family home on your own land in Greeneville or a luxury cabin in Gatlinburg.
Key Cost Drivers to Consider:
- Site Prep and Land Conditions:
Is your lot level or sloped? Does it require grading, septic, or utility installs? Mountain lots may require additional foundation or drainage planning. - Size and Complexity of the Floor Plan:
Custom homes range from simple ranch-style layouts to multi-level builds with architectural detailing. Every bump-out, vaulted ceiling, or dormer adds to framing and labor costs. - Materials and Finish Selections:
Flooring, windows, cabinetry, countertops, and fixtures greatly influence your final cost. High-end finishes and custom features naturally raise the budget, but also enhance long-term value. - Labor and Regional Costs:
Construction labor in East Tennessee remains more affordable than in many coastal or urban regions, but ongoing material fluctuations (especially lumber, concrete, and HVAC systems) still impact overall pricing.
What’s Included in a Custom Build Cost?
When you work with Olson Custom Homes, your base construction pricing typically includes:
- Project management and design consultations
- Permit and code compliance
- Framing, roofing, and exterior finishes
- Interior drywall, flooring, and paint
- Electrical, plumbing, HVAC systems
- Kitchen and bathroom cabinetry (custom options available)
- Walkthrough and final inspections
What’s not included: land purchase, site clearing (if undeveloped), major landscaping, and optional detached structures like garages or barns.
Are Custom Homes More Expensive Than Buying?
Not always. While building a custom home involves more upfront decisions, you gain the advantage of:
- Building on your own land
- Customizing every square foot to fit your lifestyle
- Energy-efficient systems and materials
- Avoiding costly remodels or repairs found in older homes
In markets like Knoxville or Johnson City, where inventory of quality resale homes is limited, building new can often provide better long-term value.
Tips for Staying Within Budget
- Know your must-haves vs. nice-to-haves.
Focus spending on layout and structural needs before luxury upgrades. - Work with a builder who offers design-build services.
Olson Custom Homes provides in-house planning and cabinetry — reducing third-party markups. - Choose finishes that balance beauty and function.
There are countless mid-range options that look custom without inflating the budget. - Plan for a contingency buffer (10-15%).
Unexpected adjustments or upgrades happen in every project. A cushion gives peace of mind.
Build With Confidence
At Olson Custom Homes, we don’t just build houses — we build lasting relationships through honesty, transparency, and attention to detail. If you’re ready to explore what your dream home could cost in East Tennessee, we’re here to walk you through every step — no surprises, no pressure.
Contact us today to schedule a custom consultation or to learn more about building on your land.