In June 2020, the Morrison government launched the HomeBuilders Scheme for buyers of newly constructed dwellings. Since then, we continue to receive many enquiries from customers wanting to buy a house and land package.
The most common questions we get are “How much does it really cost to build a house?” and “I don’t have a cash deposit. Can you help me?”
With regards to the cost of building a house, you should use the base price that is advertised by builders as a starting point only. While industry data reveals that on paper the average house costs about $320,000 to build in 2020, the “real world” figure depends on a number of factors. The total cost will vary depending on location, size and quality of finishes.
Firstly, the cost of the land varies from state to state and from suburb to suburb as well. The size of the land will also add onto the price tag – the bigger the land, the more you pay. According to industry sources, the average cost of land in Sydney was $1209 per sqm, Melbourne $837 per sqm and Adelaide $400 per sqm.
Secondly, the cost of building a home will depend on the building type, size and materials used and will result in a price difference. As an example, these factors will affect the price of the build – altering the floor plan, adding windows for more natural light, building a single storey vs a multiple storey house. In December 2019, the Australian Bureau of Statistics (ABS) figures show the average cost of building a house was $1393.55 per sqm. However, this figure doesn’t include design, planning permits, any site works or any cost blow-outs. According to ABS December 2019 Buildings Approvals data, the average dwelling in Australia spans 229.8sqm, which puts the cost for the build portion at $320,238.
Thirdly, don’t forget that the quality of the finishes e.g. carpets, taps, light fittings etc will also add to the cost of the build.
Another crucial factor that is often missed is the time it takes to build a house. Depending on the complexity and size of the building, it will take months and might even stretch into years.
If you don’t have the cash ready to secure your new home, we can help with a Deposit Power Guarantee. Deposit Power Guarantees lets you delay the payment of the cash deposit until settlement time.