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Beyond the expected

Why building a home in Canberra such expensive???

By flysnow - 22 March 2010 65

I am a new in property market and bought a residential land in the Gungahlin region. Now those days I am busy to traveling from one display home to get some design idea and most important, to find the cost of building.

And guess what? I was so surprise about how greedy and outrageous of the building cost charged by Canberra builders to local people. For example, for a double story home, looking about 220sqm (inclusive of area of Garage), 4 beds, 2 bath, double garage, the start price is around $340K. This price does not include any flooring or front landscaping cost, which you have to pay about more than $20K on top of the start price, also, there may be lots of things not in the standard inclusion list, e.g. gas cook top, change ceiling height from 2.4m to 2.7m, etc. Which means at least you probably look to pay $360k-$400k. That is about $1,500 – $2,000 per sqm !!!!!!!!

Ok, in the mean time I surf many Sydney and Melbourne builders’ website and still for the above house package, start price from $230K-$240K, and with all the upgrades, flooring and front landscaping, total price just over $250K. Example like one of my friend in Melbourne just signed contract with his builder, total area of 358 sqm and total price only $320K, that is about $900 – $1,000 per sqm !!!!!!!!!!!

So how come Canberra builders can charge 50%-100% higher than Sydney or Melbourne builders? Anyone know the reason? DO NOT TELL ME IT IS BECAUSE THE DIFFERENT BUILDING REGULATION FROM STATE TO STATE.

Sorry about the gossip as I feel so angry about the Canberra builders. Rumours I heared before was builders in Canberra make $180K profit from each home they build, and I think builders from Sydney and Melbourne will never dream about to have this high margin on their project.

My final comment: anyone saw this post and is going to build their Australian dream in Canberra, let us work out something together just being not to ripped off by the local builders. If we can put our block of land together and attract some Sydney builder to Canberra to build for us, even there is many additional cost e.g. transportation, I think it is still worth to try it.

What’s Your opinion?

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65 Responses to
Why building a home in Canberra such expensive???
georgesgenitals 7:11 pm 22 Mar 10

It costs what it costs. Instead of building something that big, try starting with a smaller property then moving up as and when you are ready. If you CAN afford this now, why the whinge?

JC 6:23 pm 22 Mar 10

Tend to agree the price is way too high. I had my house built in 2000 (after the GST was introduced might I add) for $101,000. My place is 12 squares+garage=(150m2) or $673m2. It is a medium finish house, so based on the prices above the costs have doubled in 10 years. What else has doubled in 10 years, certainly not my wages!

CoffinRX2 6:18 pm 22 Mar 10

Maybe you should have looked into this prior to buying a block of land?

Supply and demand, materials costs and shortage of skilled labour all contribute to higher costs. …. deal with it

troll-sniffer 4:29 pm 22 Mar 10

220 sq m? Sounds like a fully-fledged McMansion to me. You could downsize to fit into your budget, there’s a thought. Previous generations managed on much smaller homes.

hax 2:41 pm 22 Mar 10

I suspect you’re not comparing apples with apples.

Besides, there are a number of ‘Sydney builders’ already in Canberra..

Canberra builders prices are more realistic and include most of the actual cost up front, so no need to spend an extra $50k-$100k when your house is ‘finished’

I would be interested to see the exact inclusions and specifications for the houses your basing your comparison – do they even include council fees, water tank, insulation etc..? (I think you’ll find some major discrepancies)

The Axe Man 2:30 pm 22 Mar 10

Try Goldruby.
They don’t do display homes though.
They also don’t charge for getting your own appliances or making modifications

Gungahlin Al 12:40 pm 22 Mar 10

It’s absurd isn’t it that they only give estimates for brick veneereal?
Brick is the last thing you want to build an external skin out of here. (Anywhere in Australia actually.)

There are other materials out there…

I think CWB summed it up fairly succinctly.

But there are things you can do. Perhaps you need to stop and think about whether you really need that 4th bedroom? Assess what you need, as opposed to what you want (or worse: what the industry has convinced you is the minimum now).

And can you reconfigure the layout to reduce costs – like having one big open plan living/kitchen area. Design your bathrooms so that you don’t need shower screens – saves money, reduces cleaning costs and chemical use.

A key thing is to include up front the positives that can never be added afterwards – like hydronic heating instead of horrible ducted gas, piping your whole roof to the tank, better base materials selection, better windows, slab edge insultation. All of these things make for a more comfortable, and cheaper to operate home. They are all ‘no regrets’ options.

And remember to leave money for a proper landscape design up front (not the crap the building designer gives you to pass the DA). This will allow you to factor in requirements during building (like conduits under drives/paths, electricity supply for lights/ponds, gas supply for barbies, courtyards, and more). Money up front that will save you heaps down the line.

There are good resources around. I’d suggest the display homes are one though.

sloppery 12:36 pm 22 Mar 10

Ask around for more quotes. There are builders with not enough large jobs on at the moment, and you will find one that will do it for a better price. Also, ask the builder about ways to reduce the cost by using different shapes or sizes of rooms. Bear in mind that many bulding contracts include an allowance for things like tiles, bathroom furniture, kitchen, etc, and as such these are areas where significant savings can be made.

flysnow 12:23 pm 22 Mar 10

Thanks Skidbladnir , that is quite interesting information. As using Sydney as 100 base, Canberra is at the range of 96 – 104. However, the reality is residential building cost is 50-100% higher than Sydney, so if we use Sydney as 100 base, then Canberra is in the range of 150-200.

People are right about the material cost as material needs to shift from Sydney. However, I do think this will increase the cost by 50-100%, the additional transport should be only within 15% of the value of the cost, talking about large quantity of material. Ot

Labor cost is another reason, but under the apprentice scheme which every state government support, Canberra should have similar rate as Sydney and Melbourne. But labour shortage is another storey, while no apprentice available, builder have to hire more expensive contractors.

Overall, I still do not understand how come Canberra residential building cost so much higher. But one thing is true, this is small country town, demand is little and competition is minor, so that is why builders in Canberra can charge whatever they want.

For my own case, I will seek independent smaller builder to build my house, because even large builders they can not always be trusted. Plus, if I can gather more people to join with me, then there is a chance to ask Sydney builder to Canbbera to build for us with lower cost.

Finally, all Sydney builders, you are more than welcome to Canberra to bring the competition!!!

Skidbladnir 11:58 am 22 Mar 10

If you want a comparison, courtesy of BMT Quantity Surveyors.

They use Sydney as a basleine and then give percentage ranges for locations, Canberra gets 96%-104% of Sydney costs.
3br brick veneer project home, level block, shelf design
Low-cost finishing $980
Median-cost finishing $1,250
High-cost finishing $1,580

Architecturally designed executive residence
Low-cost finishing $2,100
Median-cost finishing $3,250
High-cost finishing $4,900

3br, 2 level brick veneer townhouse, including allowance for common property
Low-cost finishing $1,260
Median-cost finishing $1,480
High-cost finishing $2,200

3 level walk-up unit complex, concrete structure ground floor parking
Low-cost finishing $1,420
Median-cost finishing $1,700
High-cost finishing $2,200

Multi-level apartment building, including lift and basement car parking
Low-cost finishing $1,600
Median-cost finishing $1,970
High-cost finishing $2,940

Holden Caulfield 10:42 am 22 Mar 10

If it makes the OP feel any better it’s going to cost us around the same to renovate our 1950s home and extend it with a dbl garage, ensuite and living area. So much for our 200K budget, haha.

At least you will be getting a brand new home!

captainwhorebags 10:02 am 22 Mar 10

Why does it cost so much?

Because you’ll pay it. And if you don’t, someone else will.

DeadlySchnauzer 9:58 am 22 Mar 10

Additional material supply costs. Canberra builders have to ship in materials from Sydney or Melbourne. If you get a Sydney builder to come to Canberra, they will be facing those same costs, and will charge you more.

Then you get to the trades shortages. Canberra has a relatively smaller pool of tradesmen (blame the cost of living here), so they can charge pretty outrageous prices, which the builder has to pass on to you.

It would be an interesting experiment to get some quotes from out of town builders and see what kind of price you get. They will definitely not give you melb/sydney prices, but you may get cheaper than canb builders. Don’t know if anyone has experience with this?

Tony 9:54 am 22 Mar 10

People are willing and continue to pay these high price, as such, that is the price the market has set.

housebound 9:48 am 22 Mar 10

Couldn’t be worse than we alrady see around Canberra.

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