Breaking down the cost of building a new home in Perth

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The new home construction specialists at New Generation Homes are currently running a competition to win six months of fuel, six months of groceries or eight weeks of rent – chef HERE to find out how to win!

Nowadays, building a house in Perth may seem a little unheard of. There are several common factors that consistently influence construction costs, but with the impact of Covid-19 and current global conflicts, what can you expect to spend when building a home today?

We have teamed up with experts from New Generation Homes to put together a series of important factors to get you started on your new journey home. But first, it’s worth understanding how the construction costs are split in the first place, which basically looks like this:

  • 40-45% for material cost
  • 35-40% for labor cost
  • Taxes, charges, insurance and overheads

Now that you have a rough idea of ​​the cost breakdown, let’s take a look at some of the main factors that can come into play for your dream home…

External factors

If you have even a passing interest in world economic events, you’ll understand the impact of COVID-19 on a range of industries, and the new home sector is certainly one of them. From a shortage of tradespeople and supply chain issues putting pressure on materials, all of this has added up to create price increases over the past 12 months, including:

  • Wood prices have increased by more than 40%
  • The rate of masons has almost doubled
  • Plastic pipes cost 26% more than a year ago^

Add in other supply chain issues due to the ongoing conflict between Russia and Ukraine, and it’s clear to see how the average cost of building Australian homes has increased, with current average building costs per meter square to build a house in Perth between $1400 and $2700 ^.

Rider Levett Bucknall online calculator is a good place to start getting rough estimates.

The common factors

house size

To put it simply (and obviously): bigger homes = higher construction costs*, but what does that look like in dollars? As a rough guide, the cost per bedroom for a 3-bedroom single-story home using budget materials is around $1,300 per square yard, while four bedrooms push that cost up to $1,900. This only becomes more relevant when you look at the average house in Australia, which is around 195.58 square meters, a figure that rises to 236 square meters when it comes to the average size of new build homes^.

Quality

Similar to above – the better the quality, the higher the cost, and may require a little trade-off on your part to control budgets. For example, if you’re stuck on stone countertops or polished concrete floors, maybe a mid-range tile in the bathroom will help balance the cost. It’s important to not only keep in mind the aesthetics of what you choose, but also consider the long-term benefits. TRUECORE® steel house frames won’t shrink, twist or warp over time, so there’s less chance of sticking windows, jamming doors and waving roof lines and of wall. Much will also depend on your choice of builder, and finding one that can work within your budget is important to the process.

New Generation Homes

Design

Even the design process can be very expensive, especially if you work with architects or draftsmen who may charge between 8-15% of the total construction costs to design the house^. An easy way to cut costs in this area is to work with a volume builder, who offers pre-designed floor plans. This removes the design cost when choosing from proven floor plans, which can always be customized to meet your needs. It also lends itself to simpler designs, which will also reduce costs.

New Generation Homes builds TRUECORE® steel house frames that have a high strength-to-weight ratio and stay straight and true, they are an ideal choice for modern home design. Long spans, open-plan living spaces, architectural rooflines; all of this is possible thanks to the internal strength of TRUECORE® steel. And TRUECORE® steel frames are suitable for both flat blocks and angled blocks. Discover the new generation houses New house models page that offers over 60 choices, with factors such as budget, rooms and lot size all adjustable.

Site Considerations

“Site conditions” refers to the vacant land you plan to build on such things as soil type, are there any existing trees/rocks to bypass or remove, water table, slope of blocks etc This has a direct impact on your construction costs, as it indicates the amount of preparation needed to lay the foundation for your future home, while potentially influencing the design of the home.

It is also important to take into account the dimensions of the site, the access (will the materials have to be craned if there is no rear access) and the orientation (the north orientation is ideal to Perth, everything else may require additional windows or special features for natural energy storage). The Bushfire Attack Level (BAL) is also important if you are building in areas laden with bush – for example, a block in Dawesville may be cheaper to buy, but you may face building requirements. more stringent city council security.

Time limit

Due to the external factors mentioned above, construction times continue to lengthen, ultimately leading to increased holding and accommodation costs. When registering for construction, estimated times can be given, however, it is very difficult to predict the exact time before starting. A few things that can help are preparing for your pre-startup meeting, researching your selections, and learning about locally prefabricated materials, such as TRUECORE® steel frames. During your build, it’s important to establish a healthy line of communication with your build supervisor early in the process, ensuring that updates remain consistent and honest throughout the build.

Construction method

There are many construction methods that all come with a different schedule, including the use of TRUECORE® steel, double brick and brick veneer frames, with many bespoke builders specializing in a particular type. It is important to do your research, you can check out New Generation Homes’ PDF construction methods for more information on how they do it, including the impact of different materials on the thermal efficiency and acoustic properties of homes.

TruCore steel

Potential hidden costs:

  • The cost of the land block (unless you decide to buy a house and land together);
  • Cost of landscaping and fencing;
  • Cost to build small items like a clothesline, mailboxes, etc. (if you are buying a turnkey package, i.e. a house ready to move into, these are usually all included);
  • Cost of extras like swimming pools (and the landscaping around them);

As construction costs continue to rise, New Generation Homes is working hard to meet price increases to keep home construction costs affordable and make your new home dreams come true. They offer a range of new home designs to suit all budgets including less than $250,000, less than $275,000 and under $300,000.

The new home construction specialists at New Generation Homes are currently running a competition to win six months of fuel, six months of groceries or eight weeks of rent – chef HERE to find out how to win!

*This is not always the case, discuss this with the builder to understand the full detailed costs of your build.

^Source:

  • https://charterkc.com.au/research/residential-housing-construction-costs-update/
  • https://propertyupdate.com.au/how-much-on-average-does-it-cost-to-build-a-house/
  • https://www.nhbb.com.au/news-blog/why-are-costs-building-new-home-increasing-so-fast-perth#:~:text=A%20shortage%20of%20labour%20creates ,%20closes%20to%20double%20of%20price
  • https://www.realestate.com.au/advice/how-much-does-it-cost-to-build-a-house/#average%20cost%20of%20building%20a%20home
  • https://www.commbank.com.au/articles/newsroom/2020/11/commsec-home-size-trends-report.html#:~:text=Australia%20is%20again%20building%20the,biggest%20increase %20in%2011%20years
  • https://www.architectureanddesign.com.au/features/list/architect-of-draftsman-how-to-tell-what-your-next#:~:text=The%20most%20common%20fee%20structure,be %20about%206%2D8%25
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