Establishing the likely cost of a new home can be a difficult process, and many people underestimate how much it might cost to translate their ideas into reality.
CKA Group – Best Architects Melbourne, has designed hundreds of homes in Australia, United States, China, India, UAE and other countries. These have varied from modest villas up to substantial palaces with correspondingly varying price tags.
Most people have an idea of what they think a house should cost to build on a square metre basis or even per square (one square is 100 square feet or approximately 10 square metres). However, the rate can vary dramatically depending on the site conditions, standard of finishes, size of the house and many other factors. Homes we have designed have varied from $1,800 to $10,000 per square metre.
What we do know is that we can provide stunning magazine-quality award-winning homes to suit almost any budget and brief. We can help you achieve that, too.
This guide aims to provide some clarity as to what your house might cost by breaking down its components into manageable items.
Note: Construction costs have stabilised over the last six months due to a downturn in apartment construction and an easing of supply chain problems. Labour shortages have eased, which means that labour costs have stabilised. Large infrastructure projects continue to put pressure on materials and labour, and when these come to completion, we will see further easing of labour and material problems. With the current downturn trend in the industry, we see construction costs remaining stable for the next twelve months. This trend is creating an increased availability of tradespeople and materials. The future is looking much brighter for prospective home builders, renovators and developers, given the above market conditions.
For some context, we have calculated the approximated finished square metre cost of some of our recent projects.
| Ringwood House | $2,090m2 |
| Mornington House | $2,200m2 |
| Nunawading House | $2,400m2 |
| Lum Road House | $4,400m2 |
| Electric Tree House | $5,000m2 |
You can look at more of our residential projects here.
Approximate new home costs can be calculated using the following estimating process.
| Stage 1 | Calculate the structural cost of new construction (the shell) |
| Stage 2 | Calculate the fit-out cost of the kitchen, bathrooms, and laundry and add these to the structural cost. |
| Stage 3 | Calculate the cost of decks, verandas, garages, etc |
| Stage 4 | Calculate the cost of professional fees, permits, authorities charges, connection fees and add GST |
Stage 1 – Structural Shell Cost
| Standard Construction | |
| Typical timber or metal frame, brick veneer, weatherboard, rendered sheet finishes, carpet, floating timber or tile floor, 2.7m ceiling | |
| Under 200m2 | $1,750 – $2,000m2 |
| Over 200m2 | $1,500 – $1,870m2 |
| Quality Construction | |
| Brick block, Hebel or similar construction, rendered finishes, carpet, floating timber or tile floors, 3m ceiling, some external decorative finishes | |
| Under 3002 | $2,100 – $2,500m2 |
| Over 300m2 | $1,860 – $2,240m2 |
| Luxury Construction | |
| Brick block, Hebel or similar construction, rendered finishes, quality carpet, tiles or solid timber flooring, 3 – 4 m ceilings, decorative features to windows, doors, eaves etc, basement garage | |
| Under 300m2 | $3,100 – $3,780m2 |
| Over 300m2 | $2,870 – $3,550m2 |
Stage 2 – Fitout Cost
| Kitchen | |
| Standard Kitchen | $14,360 – $19,760 |
| Quality Kitchen | $22,200 – $35,600 |
| Luxury Kitchen | $32,690 – $50,900 |
| Bathroom | |
| Standard Bathroom | $13,360 – $22,810 |
| Quality Bathroom | $20,640 – $32,150 |
| Luxury Bathroom | $32,000 – $50,360 |
| Ensuite | |
| Standard Ensuite | $8,490 – $13,090 |
| Quality Ensuite | $15,020 – $21,200 |
| Luxury Ensuite | $22,540 – $34,090 |
| Laundry | |
| Standard – Luxury | $6,000 – $22,680 |
| Powder Room | |
| Standard – Luxury | $6,550 – $21,530 |
Stage 3 – Garages, Carports and Decks
On a relatively flat site with good soil, add the following percentage allowance for external works and services to cover fencing, paths, driveways, landscaping, drainage and water supply, and electrical and gas connections.
| External works and services | |
| Project up to $500K | Add 10% – 15% |
| Project from $500K – $1.5m | Add 8% – 12% |
| Project over $1.5m | Add 6% – 8% |
Adjustments may need to be made to the above percentages depending on site conditions such as soil condition, slope of the site and accessibility to the work site. We can help estimate these costs.
Stage 4 – GST and Professional Fees
You will need to add 10% GST to your estimate. You may be able to claim some of this back, depending on your personal taxation structure and the nature of your renovation. Your accountant or taxation consultant can advise you of this.
You will also need to make an allowance for architects, structural engineers, and possibly other design consultant fees. New building works require planning and building permits, as well as council approvals and, in some cases, zoning approval. Speak with your Council, as they should be able to provide you with estimates of costs, as well as expected approval time frames. These would typically be a total of 10% to 15% of the construction cost and generally need to be paid in the early stages of the project.
Total Cost Structure
The approximate cost structure of new homes and renovations is as follows:
- Materials 40%
- Labor 30%
- GST, taxes, fees, permits 20%
- Builders profit margin 10%
Owner Builders
For people considering being owner builders, savings can be made in labour costs and builders’ profit margin, although plumbing and electrical work must be carried out by a licensed contractor. Owner builders may not obtain the same trade discounts as builders, so a premium of 5% to 10% on materials may apply. Owner builders must be registered and will need to pay for homeowners’ warranty insurance. CKA can assist through this process.
Transform your vision into reality with our expert residential architects in Melbourne. Contact us today for a consultation, and let’s create your dream home together!
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