How Much Does it Cost to Build a House?

Average Cost to Build a House (2023 Update)

How much does it cost to build a house? It’s a common question and the answer is tricky: It depends.

ABS statistics say the average house in Australia costs about $1400 per m². However, this figure doesn’t include design, planning permits, any site works or contingencies, and it’s likely out of date due to recent Covid-related increases in the cost of labour and building materials.

In our experience, that’s well below what you would expect to pay to build a single storey home on a level block in the Coffs Harbour region – expect costs of $1,900-$2,200/m²including council approvals and inspections and site works. A two storey house may be closer $2,300-$2,500/m², and a complicated steep site build could approach $2,800/m² or more.

However, there are many factors that influence the final cost of a house so it’s impossible to provide a one-size-fits-all guide to construction pricing.

In general, a larger home will cost more to build. But there are many other factors that a builder must consider when quoting on a project. The location and slope of your land can make a big difference. Complex homes tend to cost more, and government regulations can have a big impact too. Luxury finishes can be expensive, but there are some inclusions that can be added quite easily at a later date. Building in regional Australia tends to cost more than building in the capital cities, although land prices are usually much cheaper.

Even with all of these variables, there are a few important tips to keep in mind when considering the cost to build a house.

If it sounds too good to be true…

The old saying “If it sounds too good to be true, it probably is” applies to the building industry. A builder offering significantly lower prices than any other builder in your region is likely to be cutting corners or excluding key elements of the project.

Common tricks include leaving out important elements of a new home like floor coverings, driveway and alfresco concrete, fly screens, local council fees, television antennas, or even a letterbox. When these extra costs are included, the price often looks much less competitive!

As you research the market and meet with builders, you should start to get a feel for how much is reasonable to build a new home. If an offer sounds too good to be true, it probably is, and you should proceed with extreme caution.

Be particularly cautious of promotional deals offering a very large up-front discount. The building industry works on very small margins – few builders can afford to discount their prices by tens of thousands of dollars. A large up-front discount is usually clawed back with hidden costs and price gouging on upgrades later in the process, when you feel like you are so far along that you cannot go elsewhere.

You get what you pay for!

Builders that undercut the market often end up compromising on quality. This is just common sense, but it’s often ignored by new home buyers who are looking for a bargain. A builder operating on slim margins is faced with the constant temptation to cut corners, use lower quality trades, and spread their project managers too thin. Common areas where quality is compromised are paint, insulation, fixtures, and even termite protection.

What are “site costs” anyway?

Every building project has site costs, such as temporary fencing, earthworks, and silt fencing. Some sites are more expensive to manage than others, with additional requirements like scaffolding, cranes, fill removal, engineering reports, retaining walls, or concrete piers.

But unfortunately, the label “site costs” is sometimes used as an excuse to add inflated extra costs once a buyer is committed.

A good local builder should understand the site conditions in their area. Your builder should disclose any uncertainties before you sign a contract. Any likely additional costs should be clearly explained and justified.

Price isn’t everything

Building a new home should be a enjoyable experience. You are embarking on a journey to create a home for your family – somewhere you will grow, cry, laugh, and make memories.

While we all have budgets, price isn’t everything. The experience of building a home is important too. Consider these questions:

Will your builder treat you like a number on a production line, or will you be part of the family?
Will your new home have a dedicated project manager who is accessible through the build?
Can you personalise and customise your home’s design and finishes without extra fees?
Will the builder be flexible with your choice of finishes and colours (some builders offer as little as 3 hours to choose all the finishes for your new home)?
How does your builder manage warranty issues and after-sales support?

The wrap up – choose a trusted builder

As you can see, it’s not simple to answer the question “How much does it cost to build a house?” As a result, it is very important to work with a builder you can trust. At Balance Design and Construction, we are transparent about our pricing. We understand that our clients don’t like surprises, so we are upfront about potential extra costs or uncertainties. And we use an HIA fixed price contract. We are also happy to put you touch with past clients, so you can ask them directly about their experience with Balance.