Though it's easy to estimate the price of a piece of land, it's not an exact science estimating the cost of building a home on it.
The average cost of building a house in 2020 was about $320,000 on paper. However, different factors like quality, size, timeframe, location, and complexity determine the actual cost.
Australian federal and state government have provided several schemes to encourage people to buy and build. These included the homebuilder grant and stamp duty fee discounts on first-time home owners.The average price of land in Sydney and Melbourne is $459,000 and $330,000, respectively.
According to Australian Bureau of Statistics (ABS) data, the average cost per sqm is $1,393.55. This figure is exclusive of planning permits, cost blow outs, and site works.
The build cost for an architecturally designed house varies, with the minimum estimated at being around $3,000 per square metre.
Even though the cost of building a custom-design family home may be a drawback to most Australians, it' could be cheaper than buying as long as you can avoid extra costs associated with building. If you are not careful, these hidden costs may ruin your building budget. Below are five common costs you are likely to come across.
A builder or a building company gives a fixed quote for soil test and contours, which cost about $1,000 to $2,000. But in case your site has rocky soil, in a slope, or any other issue that may make building difficult, it will cost you extra.
The site cost varies based on the soil and contour test results. You may pay anything between $10,000 to $70,000. Plus, elevation costs if you need a sloping block, not forgetting connection and maintenance costs of water, gas, telephone, sewerage, electricity and fire control.
Not all building quotes include flooring. But if you want your floor space to have tiles, carpets, or floorboards, You are likely to spend about $10,000.
Like flooring, driveways don't appear on many building quotes.
After agreeing on the design and signing off the building contract, it will cost more to do any variation on the plan. Any change in the projects leads to additional costs like more materials, legal fees, penalty clauses, and more labour.
The overall cost of constructing a four-bedroom house is $1,900 to $3,900 per sqm. These figures are the actual costing used by architects, home builders, and quantity surveyors. Obvious factors bringing variance in cost are materials, finishes, fixtures, design, details, and accessories. Builders call it the level of finish. They are further divided into three - material, finishes, and fixture level of finish. It can be low, mid, or high budget, depending on you. More importantly, get house plans drawn and seek quotes from at least three builders. This way, you will have a firm idea of how much the project will cost. Architects and builders mainly compute average costs based on per square metre. With that in mind, an average cost to build a four-bedroom house would cost a significant amount based on the below.
$1,900 per sqm for a single level brick veneer with a level block using budget materials.
$2,400 per sqm for brick veneer single level on a level block if you use mid-range finishes.
$2.900 per sqm for the full brick two-level home level block with top quality finishes.
$3,900+ per sqm is designed by an architect and has a full brick, two-level home with a level block.
Though it's easy to know the final price of land, it's much more difficult to estimate the exact cost of building a home. For example, in Victoria, the cost to build is about $423,808, while South Australia is around $314,736. Also, remember these figures are rough estimates and don't include extra costs like delayed timeframes, accessories, quality of material, among others.
Various factors add up the cost to build a home. To develop a final cost estimate of a project, you must include all estimates based on experiences and research. The obvious ones include permits, land acquisition, engineer review, and high construction costs. Other costs include:
Past projects can serve as a perfect reference to similar projects in the construction industry. Their pricing details can roughly show what to expect as an estimated cost in the new project. However, the prime cost must factor in the current market prices of construction items.
Cost of constructions includes material costs, shipping, and applicable taxes if any.
Labour charges are not constant and change with supply and demand factors.
The state of construction can increase construction costs. Conditions like poor soil quality, contaminated materials, conflicting utilities, wetlands, among others.
The construction cost should also include insurance costs for covering construction workers, tools, and specialised equipment.
During budget estimates, it's advisable to have a 10% contingency to cover the unforeseen cost and inflation.
The above are just a few; other factors include inflation, timeframe, quality and specifications, regulatory requirements, project size, location, and engineer reputation,