Spec Home vs Custom Home: What’s the Difference?


If you’re just beginning the search for a new home, you may find the housing market a little tough to navigate. This is especially the case if you are in the market for a new home. You have a lot of decisions to make including home location, size, budget, home builder, design, and more.


One of the more common decisions prospective homeowners are faced with, is whether to buy a custom home or a spec home. 


This blog will describe what a spec home is, what a custom home is, and how they differ from one another. We’ll also talk about the advantages and potential disadvantages of each option.

What is a Spec Home?

A spec home, short for “speculative house” is a home that is designed, built, and then sold. When a builder builds a spec home, it’s built with the intention of a quick sale for a profit.


Most of the time, a spec home isn’t sold until it’s completed. But sometimes, a buyer may come in towards the end of construction to purchase it. 


However, the home is built without input from the future homeowner. Instead, the builder designs and selects all finishes themself. Usually, the builder will use a more neutral style that will attract the most prospective buyers. 

What is a Custom Home?

A custom home is a new home, built to be unlike anyone else’s. When you choose to build custom, you are involved in every step of the design and building process. You choose the lot, the square footage, the rooms, floors, appliances, paint colors, and much more.


A custom home will match your exact specifications and will be tailored to suit your lifestyle. If you have 4 kids, for example, you have the option to include a bedroom for each child, a large bonus room for play, and a basement for extra storage or entertaining. 

The Differences Between a Spec Home and a Custom Home

So, how do you choose between a spec home or building a completely custom home? Below are the five biggest differences between them.

  • Home Location

A spec home is most likely to be built in a subdivision with easy access to utilities like water, electric and plumbing. 

A custom home can be built anywhere, from a lot in the middle of nowhere, to a lot inside a subdivision, it can be done. However, there will be an increase in cost if you choose to build a custom home on a lot that doesn’t have easy access to utilities. 

  • Level of Customization and Flexibility

Think about your lifestyle. Do you spend a lot of time in the kitchen? Do you entertain guests often? Do you work from home? Or, do own large vehicles like an RV, boat, or other equipment? 


Your lifestyle plays a huge role in what you need out of a home. A larger family means more space. If you work from home, you would likely value a gorgeous home office with natural lighting and plenty of storage. If you spend most of your time away from home, you may not need much space at all. 


A spec home may be of a more modest size, and won’t come with all of the nicest upgrades. When you purchase a spec, you don’t have any say in what flooring goes down, what paint colors go up, or what your kitchen will look like. 


When you build a custom home, you get to choose everything. If you want every room painted a different color, so be it. If you prefer marble countertops in the kitchen, but quartz countertops in the bathrooms, that’s your choice. Your builder will walk through the entire building process with you, keeping you involved every step of the way. 

  • Level of Involvement and Interaction With the Builder

With a spec home, you aren’t involved in any of the building process. You simply purchase the home after it’s completed, and you move in. You may not ever meet the builder themself, but they are likely available for questions about the home before you move in. 


Some prospective homeowners prefer to be involved in everything, and are more comfortable having a close working relationship with the home builder. If this sounds like you, a custom home may be the way to go. 

  • Move in Time Frame

When do you want to move? Do you need to be in a new home by Christmas? Are you moving to another state and need to move in in the next two months?


Your timeline will dictate which route you take.


If you need a home sooner, a spec home is the best option since they are designed for immediate occupancy.


A custom home is a more lengthy process. You will be a part of it from initial consultation, to design, to construction, and move-in day. Although building a custom home is more of a waiting game, custom homes are perfect for those that value customization over speed. 

  • Total Cost 

So, what costs more…a spec home or a custom home? Well, we wish there was a more clear-cut answer.


Building a home includes an infinite amount of variables including lot location, lot size, home size, upgrades, etc; so it’s impossible to say that one is cheaper or more expensive than the other.


But, in many cases the builder that is building a spec home is likely to use “safer” product selection that could be discounted or lower in cost. If a builder were to choose high-end selections for a spec home, the price may be way out of most people’s budgets. 


Those that build a custom home, however, have complete control over where their money goes. If your custom home budget is $850,000, for example, you will know exactly where every dollar is going, and you have control over whether you spend more or less than your total budget. 

Spec Home vs Custom Home: It’s All About Preference

Don’t get us wrong. Builders that build spec homes vs custom homes are just as dedicated and proud of their work. Your decision will ultimately come from the type of experience you want to have.


Do you have a few years before you need to move in, prefer a unique floorplan, want to choose your own finishes, and must have a special room to bathe your pets? – A custom home is for you. 


Do you need to move into your new home within the next few months, prefer to live in a developed subdivision, and feel excited about making customizations after you move in? – A spec home is for you. 

Custom Homes by Modern Structure, is an Evansville, Indiana based home builder and is experienced building both custom and spec homes all around the area. To set up a free building consultation, fill out this short form or give us a call at 812-306-8438.