In construction, more square footage equals more money, so think about your project's size and ask yourself how much space you really need. Of course, you want to balance this out by considering resale value, but if you can cut back a few square feet here and there, you can save quite a bit. Depending on where you live and what the construction market is like, home construction can cost between $80 and $200 per square foot [source: Braley]!
Cutting back square footage doesn't have to mean living with tiny rooms in your new space. When we were talking to the architect about our home addition, we'd originally wanted the guest bedroom we were adding to be 12 x12 feet (3.6 x 3.6 meters). By cutting back to 10 x 10 feet (3 x 3 meters), we shaved more than $4,000 off the price of our addition. The guest room is a bit smaller, but with the money we saved we were able to add a back deck to our home, which was totally out of our budget before we played with the room sizes a bit.
Any time you add on to your home, your power and gas bills are going to increase. Remember that you'll be paying to heat and cool that extra space when the project is done. By opting for slightly smaller rooms you not only save on construction costs on the front end but reduce your cost of living on the back end.