Trump says US embassy in Jerusalem will cost only $250,000

Trump said his staff told him it would cost $1 billion.

"We'll have it built very quickly," Trump said. "A lot of people wouldn't be doing it quickly like that. But we're going to have it built very quickly and very inexpensively."

"They put an order in front of my desk last week for a billion dollars. I said, 'A billion? What's that for?' I said, 'We're not going to spend a billion dollars.' And we're actually doing it for about $250,000. So check that out," he said.

"Now, it's temporary, but it'll be very nice. Two hundred and fifty thousand dollars versus a billion dollars. Is that good?" Trump said.

White House press secretary tried to clarify Trump's remarks in a press briefing later Monday.

"I think the point is that he's making is he's going to do it faster and far less expensive than a billion dollar project as was projected," said Sanders.

“Jerusalem was a wonderful thing. And I know it was very much appreciated” said Trump. “That was a decision that I had to make. Many presidents were discussing whether or not to make that decision and they promised it in campaigns but were never able to do what they should have done. So I was able to do it.”

In the Oval Office, Netanyahu thanked Trump for following through on his promise.

“Other leaders talked about it,” said Netanyahu. “You did it. I want to thank you on behalf of the people of Israel.”

Trump said that he “may” visit Jerusalem for the opening of the new embassy.

“I think we have a very good chance,” Trump said of finding a solution for peace between Israel and Palestine. “This is the hardest deal. This is years and years of opposition and frankly hatred and a lot of things,” said Trump “I will tell you that if we could do peace between Israel and the Palestinians, that would be a great thing for the world. It would be a great thing for this country and for everybody. So we're working very hard on it.”

Netanyahu named Iran as the greatest challenge facing the United States and Israel in the Middle East. “Iran must be stopped. That is our common challenge,” said Netanyahu. “If I had to say what is our greatest challenge in the Middle East to both our countries, to our Arab neighbors, it's encapsulated in one word: Iran. Iran has not given up its nuclear ambitions.”

ABC News' Conor Finnegan contributed to this report.