Industry estimates suggest that the average cost to build a single-storey, 3-bedroom house in Melbourne is between $1,300 and $2,000 per square metre. For a 4-bedroom house, this increases to between $2,000 and $3,000 per square metre. You can expect to pay 5-10% above these estimates for double-storey properties.
buying: comparison of costs. As you see, there is a big difference in the costs of building a house versus buying a home in Sydney and in other capital cities. The same is for every city; buying land and then constructing your own home is cheaper than buying an existing home.
The average cost to build a 3-bedroom house
$1300 per square metre for a 3-bedroom weatherboard house on a level block, using budget materials. $1600 – $1900 per square metre for a 3 bedroom full brick single level project home, on a level block, using mid-range to high-end materials and finishes.
The current housing market
While there's no hard and fast rule that building will be cheaper than buying, trends do suggest that building is usually the more affordable option. According to 2021 statistics, building a house in Brisbane could save you $50,000 or more, compared to buying a similar existing home.
CoreLogic's Cordell Construction Cost Index (CCCI), which tracks the cost to build a typical new home, returned a growth rate of 0.9% for the first three months of 2023, a level not seen since March 2021.
Consider going modular or prefabricated
Hipages.com.au say, "In general, modular homes cost between $2500 and $3000 per square metre, but the cost will vary." Read more on how to build a home in our complete guide.
On average, building a house is cheaper than buying
All costs include stamp duty. The cost of building includes land purchase and assumes a first home owner concession on stamp duty where applicable. In 2021, building was the cheapest option for every city apart from Perth.
On average it can take approximately 6 months to complete the build of a house. However, it can be as little as 4 months or potentially more than 12 months. For a pre-designed house, you are looking at roughly 4-6 months, while custom designs can take longer at an expected 10-16 months.
An Estimated Cost of Building a Home
A two-storey home in Australia can be expensive to construct in 2023, depending on its size, layout, and style. On average, two-story homes typically cost between $1,700 and $2,500 per square foot.
On the one hand, buying land first and building later provides more time to save funds for your home's construction. Although, if you are currently renting, it can be a financial juggle to cover rent payments while also managing the repayments on a land loan.
Ranch-style homes are not only popular but also one of the most cost-efficient home styles to build. These homes typically come in a rectangular shape, though many resemble “T” or “S” shapes. The ranch style's simple layout reduces complications in construction.
The average build time for a new construction in the U.S. was 7.2 months in 2021. But that number can vary widely when you consider the type of house. For a tract or spec house, that time is around 6.5 months, and for a custom house, it averages just over 12 months.
The timeframe for how long it takes to build a house
On average, an Australian home takes between four to 12 months to construct. This is only after the land is purchased and the design is approved. According to industry experts, 10 to 12 months is considered the norm for building a quality, two-storey home.
Average Building Costs and Construction Costs
The average total cost of building a house in Australia is about $2500 per square metre or around half a million for a typical home. However, the price varies depending on where you live and the standard of finishes applied to your project.
While the cost of building is influenced by many factors including location, site, finishes and design you can expect the cost to be between $620 -$3900 per sqm. However, this figure doesn't include design, decoration costs - such as painting, planning permits, any site works or any cost blow-outs.
4 Bedroom House
The ideal size for a four person home is between 223 and 260 square metres.
Essentially, the life of a house depends on the type of materials used in construction, the degree of workmanship, the kind of maintenance required, and whether maintenance is actually followed through. On average, a well-built house can last for more than 60 years.
Supply and demand imbalance
One of the primary reasons for high house prices in Australia is the imbalance between supply and demand. Housing supply is under ongoing strain due to an increasing population and a limited land supply, particularly in large cities like Melbourne and Sydney.
House prices in Australia are extremely high compared to income, relative to other countries. The market is propped up by rules that provide tax deductions for property investment, and by repeated state government bonuses for first home buyers. Furthermore, the supply of new homes is hard to generate.
There are many options for building your home, from house and land packages and project homes to custom-built properties or DIY kit homes. Each has its own benefits, disadvantages and costs, so it's important to work out where you want to build, what you can afford and which option best suits your needs.
The Australian state that is cheapest to buy a house is Tasmania, which sits off the southeast coast of the Australian mainland and is the country's smallest state.
Ranch Homes
A home with a simple and concise layout is the cheapest type of house to build. Ranch homes are typically single-story structures with attached garages. They're easy to find construction plans for and highly customizable, so you can find a home that fits your needs and budget.