How much does it cost to build a house?

How much does it cost to build a house per square metre?

The variation in square-metre building costs can be huge, but ballpark figures can help you estimate the costs you might expect.

We've done some research to help you estimate your building costs and obtain construction finance.

According to BMT Tax Depreciation Quantity Surveyors, the following estimates could help you budget for a house build, based on 2025 construction costs. But bear in mind there are different estimates if you're building a unit or townhouse.

What factors affect the cost of building a house?

Land and location

General manager of Brisbane-based construction and development company kalka, Drewe McCredie, says: "Land is the first prime factor in the overall cost of the home with respect to the budget and, in the majority of cases, will determine the budget for the house build."

The nature of the block – whether it's flat or sloping, for example – will also affect the total cost. "Each state also has its own varied rates for taxes, insurances, and certification processes and fees. Building outside of a metropolitan area will also affect the cost for out-of-area allowances for additional travel," McCredie says.

Height

McCredie says that it will generally cost more to build a two-storey home than a one-storey home as there are additional items required to build a second-storey home, including an additional floor system, stairs, scaffold, fall protection equipment etc. that are not necessarily required for a single-storey house build.

Materials

From brick and brick veneer to a lightweight clad such as weatherboard, the materials used in the construction of your home will have a big impact on the total cost.

"The approximate costs of a brick veneer vs a fibre cement sheet clad are going to be about on par," McCredie explains. "The different range of bricks and also type of mortar colour will increase the cost of the brick component, and some bricks are approximately three times the cost of your entry-level brick. Lightweight cladding is also in a similar comparison."

Trades

Trades also play a part in the cost of your build. "Brick trades typically have different rates for upper or lower bricks, and also single- and double-height bricks. Lightweight-clad trades generally have a single rate for each cladding type," McCredie explains.

Then there are the other trades you need to get your house to move-in status: plumbers, electricians, tilers, painters, plasterers, renderers and even landscape gardeners.

How the finishes impact the cost of your build

How to choose a builder

The builder you choose to complete your construction project is the next factor that can have an impact on the overall price. Builders can vary not only in the type of work they specialise in (for example, custom-built homes vs display homes), but also in how much they charge for their work. It's essential to obtain quotes from several builders to get an accurate idea of building costs, as well as which builder offers the best value for money.

How much does it cost to build a kit home?

If you're looking for a low-cost option when building a house, you might want to consider a kit home (also known as a modular home or prefabricated home).

These homes are designed and built off-site, and then the materials are delivered by truck to your block of land for assembly.

According to HiPages, the average prefab home costs between $2,500 and $3,000 per square metre.

Total costs for building prefab homes could be:

• $100,000+ for a small, basic build
• $150,000+ for a medium build with higher quality finishes
• $300,000+ for a large build, custom design and superior finishes

What you need to know about building a kit home

Kit homes can be cost-effective, allowing owner-builders to do much of the work themselves, and come in a wide range of designs. However, there are several factors that can affect the cost of a kit home.

• The model. A four-bedroom kit home costs substantially more than a one-bedroom kit home. The floor space of your chosen design has a big impact as does the number of bathrooms and other spaces (e.g., a study).
• The cladding option. Brick, weatherboard, render and more are available.
• The site. Sites that are difficult to access or that require levelling could result in increased costs.
• What's included in the package. Some kit-home prices you see quoted online will include nothing but the bare shell of a home, while others will include everything from air conditioning to floor coverings.

Are kit homes really cheaper than standard homes?

Prefabricated homes can be cheaper to build than standard homes, but it really depends on how you choose to build them.

For example, getting a builder to put the kit home together will cost a lot more than if you do most of the work yourself. But you still have to consider the cost of paying various trades (plumbers, electricians) to get your home to the point where it's ready for you to move in.

The key to deciding whether a kit home is the most affordable option for you is to make sure you're fully aware of what's included in the package and what you'll have to pay extra for. You may need to pay for soil testing, laying slabs and any finishes you add yourself.

How do you get finance to build your house?

If you need to borrow money to build your home, you'll need to apply for a construction loan.

These loans can be set up to allow you to purchase a vacant block of land first and then build on that land within a set timeframe or to fund the construction of your home if you already own the land.

Unlike a regular mortgage, where the lender gives you access to a big lump sum when you take out the loan, a construction loan is set up a little differently. The lender calculates the total amount you will need to borrow to pay your builder, and then allows you to access portions of this amount at specified times to pay your builder throughout the construction process. These loan withdrawals are known as progress draws and are a predetermined percentage of the total mortgage amount.

The lender will typically set a timeframe, such as one year, for the construction of your house and probably only require you to make interest payments while your home is being built. Once construction is complete and the builder has been paid, you will start making full principal and interest repayments.

Frequently Asked Questions about costs of building a home

• Is it cheaper to build or buy a house in Australia?

  Both options have the potential to be cheaper or more expensive, depending on a range of variables, including what type of property you're looking at, the quality of the finishes, the area you're buying in, the availability of local tradespeople and more. It can also change based on how the market is affecting construction costs at any moment in time. This makes it tough to give a clear-cut answer!

  You can read more about this topic in this guide.

• What is the cheapest type of house to build in Australia?

  Kit homes and modular homes are often seen as a low-cost option because owner-builders can do much of the work themselves and save on labour. But per-square-metre prices for prefab homes aren't necessarily lower than a standard build with a low or medium level finish, so check what's included in the package and what you'll need to pay trades for before you decide.

• How much does it cost to build a room in Australia?

  The cost to build a room in Australia depends on the room type, its size and the finishes you choose, so get itemised quotes from a few builders to compare.

Written by

Richard Whitten

Senior Money Editor

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Richard Whitten is Finder’s Senior Money Editor, with over eight years of experience in home loans, property, credit cards and personal finance. His insights appear in top media outlets like Yahoo Finance, Money Magazine, and the Herald Sun, and he frequently offers expert commentary on television and radio, helping Australians navigate mortgages and property ownership. Richard started his career in education and textbook publishing in South Korea. He holds multiple industry certifications, including a Certificate IV in Mortgage Broking (RG 206) and Tier 1 and Tier 2 certifications (RG 146), as well as a Bachelor of Education from the University of Sydney and a Graduate Certificate in Communications from Deakin University. See full bio

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