National averages will not reflect home building costs in expensive areas of the U.S., but the average cost for this size home in the U.S. in 2021 is around $248,000. Fully custom homes can cost far more than this. You will need to consider how much money you can afford to spend on a custom home if you are trying to stay within a set budget. Your location may heavily impact the cost of building a 1,500 square foot home. In some areas, 1,500 square foot homes may be more common than others. Building costs are higher in the Northeast and West. Furthermore, in cities such as Los Angeles, building a 1,500 square foot home may cost $500,000 or more. While a larger home may cost more money, it may make more sense in terms of value. Contractors may be able to offer a better deal for a larger project.