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Before you buy an inner city Melbourne property to renovate, extend or knock down and rebuild, here's what a builder checks that most buyers don't.
Every week, someone comes to us having found a property in a suburb like Fitzroy, Carlton, or Hawthorn. They have walked through it twice, maybe three times. They have imagined what a renovation looks like, what the kitchen might look like, how the garden could work.
And then we walk through it with them, and start asking questions they have not thought to ask.
Buying an inner city Melbourne property to renovate, extend, or knock down and rebuild is a completely different exercise to buying a finished home to live in. The things that will determine whether your project is joyful or painful are rarely visible on inspection day. Most of them you cannot see at all.
Here's the checklist we run through every time a client is considering a property for major building work.
Orientation is one of the most important factors in how liveable your home will be over the long term, and it's also the one few buyers check.
North facing living areas receive winter sun and can be shaded from summer sun. A home with north to the rear has real potential for warm, light filled living spaces, while a home with north to the front has to work much harder for the same result.
We personally wouldn't buy a property with north to the front. Too many clients come to us with cold, damp homes wondering why their heating bills are so high, and the answer usually starts with orientation. From the peak of summer to the peak of winter in Melbourne, there are more than five hours' difference in daily sunlight. Getting passive solar design right is the foundation of a comfortable home.
North to the front does not automatically make a property unworkable. We have created beautiful homes from these sites by designing internal courtyards that bring northern light deep into the home. But it is a costly solution. It means a larger, more complex build. You need to go in knowing that early in the design process.
Check orientation on Google Maps before you book the inspection. If the block is narrow and north to the front, the challenge becomes even more significant. A wider frontage gives you flexibility to open living areas to whatever northern light you can access. A six metre wide block, such as a terrace house with north to the front is very difficult to execute passive solar design.
Where a property sits in the street matters almost as much as which way it faces, and it's often overlooked. Ideally, your block sits higher than the street. If the property is at the lowest point of the street, or the block falls from the street down to the house, it's the one most exposed when street drainage blocks up. A flash flood can fill the drains with debris quickly, and the water heads for the lowest point.
Before the inspection, use Google Street View to see which way the road and footpath fall. At the inspection, stand at the front boundary and check whether the land rises to the house or falls towards it. Then check VicPlan for a Land Subject to Inundation Overlay or a Special Building Overlay, which flag properties affected by flooding and overland flow. Where your stormwater drains to is covered under service connections below.
Before you inspect, open VicPlan, type in the address and look at every overlay that applies to the property: heritage, flood, vegetation and environmental significance overlays. They all affect what you can build.
Flood levels across inner Melbourne have been updated significantly in recent years. Many properties that were previously unaffected are now within flood overlays. This affects slab heights, extension design, and insurance. We would avoid a flood affected property where possible.
If VicPlan shows a heritage overlay, or you're not sure what you're looking at, call council and ask for the planning department. They're often unavailable, but leave a message and they'll call back. Give them the address and ask one specific question: Is there anything that triggers a planning permit for this property?
That question often surfaces things VicPlan does not show. An experienced planner will tell you what you are dealing with. It takes about fifteen minutes and can give you all the information you need so you know the restrictions on the property you’re buying.
If the property carries a heritage overlay, understand what that means for your timeline. We have had heritage projects move through council in three and a half months, and we have had others take eighteen months. The difference almost always comes down to whether you engage an experienced town planner to write the submission and whether you stay within the parameters council will accept. Push the boundaries on a heritage facade, overshadowing, or ResCode compliance, and you push the timeline. For some clients, that is acceptable. For others it is a dealbreaker worth knowing about before you buy your dream property.
Walk through the property looking at walls, ceilings and floors. Wall and ceiling cracking indicates structural movement that needs to be understood and if there are any remedial works required, they need to be costed. Wavy floors in a heritage home are something to contend with, though are often not as concerning as structural concerns that show up in walls, especially in old double brick Victorian era homes, especially those built on the boundary.
Experienced sellers paint before they list. Fresh paint can conceal movement in the walls, but the floors can't hide it, because you can't easily paint a floor flat.
If you are considering a large scale renovation on a property, we recommend two different inspections. The first is a standard pre-purchase building inspection from a company like Just Inspections, which tells you what is currently there and the condition it is in. The second is a review by someone with renovation experience, such as an experienced architect or a building company with design experience like ours, who can view the property for its potential and the challenges that sit within it if you are planning a renovation, extension or knockdown rebuild. For a property you intend to spend significant money on, it's worth having both.
This is where some of the biggest hidden costs sit, and it's the part buyers most often skip.
Start with the legal point of discharge, or LPD. This is where your stormwater drains to. If the LPD is on the low side of your block, which it normally is, you’re in a good position. If it is on the high side, or your block is really flat you may need a pump and pit to get your stormwater out. Not a project stopper, but a real construction cost to understand.
Check for sewer easements. An easement running through your property affects where you can build and what footings you can use, and it defines your buildable zone in ways a real estate floor plan won't show.
In older inner city suburbs like Fitzroy, Carlton, Brunswick and even larger blocks in Hawthorn and Toorak properties can have combined sewers. This means your neighbour(s) share the same sewer pipe as you. If building a new home or large scale renovation, we have to uncombine them to ensure your sewer doesn’t affect neighbouring properties and vice versa. It adds cost. Not an enormous cost, but it needs to be understood and budgeted for early.
Finally, look up. Overhead power lines affect where cranes can operate, how materials are delivered and what your construction logistics look like. Call the electricity distributor for the area and ask whether an underground pit is available. Sometimes it's free and sometimes there's a charge, and it's always better to know before you've purchased the property.
This is a practical consideration that buyers rarely raise, and having specialised in custom home and renovations on tight inner-city blocks, we are all too familiar with site access challenges.
If the property is attached on both sides with no rear lane access, getting machinery, concrete trucks and materials to the back of the site becomes a real logistical challenge. Corner blocks are the most flexible, and properties with rear lane access are excellent. A property built to both boundaries with no side or rear access will need council permits for footpath occupation during construction, which is another cost and another process to manage.
None of this is a dealbreaker, but factor it into your assessment of the property and your overall construction budget.
Councils have also become much more diligent about traffic management. If your build needs a skip, crane, concrete pump or deliveries that take up the road or footpath, expect to need a road or footpath occupation permit, and most closures need a traffic management plan prepared by a qualified traffic management company. In Darebin, for example, council processes applications within 10 business days, with an assessment fee of about $147 and closure fees from around $110 a day for a footpath to $326 a day for a full local road closure (Darebin City Council). Merri-bek requires the traffic management plan before you apply, charges $390 for the permit and allows at least five full working days to process it (Merri-bek City Council). These costs may seem small but they can add up and it’s best to know about them early and only an experienced builder in your local area can provide this insight. We build these permits into the program and budget from the start, so they don't hold up the build.
The age of a property matters, and so does whether it has been renovated before, and when.
Genuinely original homes, built pre-1970’s and largely untouched, are often the most predictable to work with. You know what you are getting. After a couple of decades or a hundred years the structural integrity of the home is clear.
The era to be most cautious about is homes renovated or extended between 1980 and 2010. We've seen properties from this period with asbestos buried beneath additions rather than properly removed, drainage that should never have passed inspection, and structural framing that gave way the moment we opened the walls.
If you're on the fence about whether to renovate or knock down and rebuild, we can run a full cost analysis on both options. It's one of the most valuable parts of our design and build process, because it gives homeowners clarity.
Take particular care with double brick homes. They're beautiful and they feel solid, but double brick walls are much harder and more costly to move or open up than lightweight timber framing. If your plans involve reconfiguring internal spaces or adding openings, understand what those walls are made of before you fall in love with the floor plan.
Also understand that structures built before ResCode came into effect in 2001 (Parliament of Victoria) may sit at boundaries or heights that would not be permitted today. If those structures are demolished, they cannot automatically be rebuilt as they were. We have designed projects specifically around retaining boundary walls that could not be rebuilt because they didn’t meet today’s ResCode but their position genuinely benefited the home. It requires careful planning and sometimes additional engineering cost, but it is the right call when the wall is an asset.
This is the advice we give every prospective client, and it's the step that makes the biggest difference.
A rule of thumb we've found accurate over many years is that buyers' budgets tend to cover about 70 per cent of what their wish list actually costs. That gap isn't because buyers are unrealistic. Major renovation and construction projects have real costs that aren't obvious until someone with experience looks at a specific site and a specific brief.
A feasibility plan with a builder before you commit to a design direction is the most valuable step in this entire process. It establishes a realistic budget range for your site, your goals, and your circumstances. It creates a benchmark that the design process can be measured against. It prevents you from spending months and tens of thousands of dollars on a design that was never going to be buildable within your budget. At Sustainable Homes Melbourne, this is a service we offer. For a small fee, our design team maps out the build zones for your project, applies our current day m2 rates, and gives you a budget range we can take into concept design, whether you are planning a renovation, an extension or a new home.
For context on what to plan for: inner city Melbourne renovations and extensions run from roughly $5,000 to $12,000 per square metre, depending on scope, size and complexity (the smaller a home the higher per square metre). New homes in the same context run from roughly similar ranges, highly dependent on finish level and site complexity.
Our renovations are comprehensive in scale. We address structural compromises, build above the bare minimum Australian construction standards (which are miles behind our first world friends) and create what we often describe as a new home from an old one. A purely cosmetic renovation can cost much less in the short term, but it's a fundamentally different product.
Build town planning time into your thinking from the start. If your project needs a planning permit, allow at least four to six months, and more if heritage is involved. That time is simply part of the process.
The projects that go well have one thing in common: builder input came early. Early in the property assessment, early in setting the feasibility benchmark, and early in the design itself, with commentary as the brief evolved and the design took shape.
The most consistent pattern in projects that go wrong is the opposite. A client engaged an architect or designer and worked through the full design process without any builder involvement. They lodged for planning. They completed documentation. They commissioned engineering reports, energy assessments, and soil tests. And then they went to tender, and only then did the full picture of cost become clear. That can be a painful and expensive position to be in, and it is entirely avoidable.
At Sustainable Homes Melbourne, we work in two ways. We do take on a small number of projects from architects and designers when a client comes to us with an existing design relationship they value. We respect good design talent and we know how to work alongside it constructively. But our preferred model, and the one that consistently produces the best outcomes, is design and build under one roof. We explain why bringing a builder in early matters in The Biggest Mistake Homeowners Make When Engaging a Designer or Architect.
When design and construction sit together from day one, the budget conversation never gets lost. Our designers know what things cost because they work alongside the people who build them. Scope creep gets caught early, and value management happens during design, when there's still real flexibility, rather than after a client has fallen in love with a finished set of drawings. The result is a better process and, in our experience, a better home. We explore this further in the House of Meaning episode Design & Build: Is It Right For You?
Buying a property with major works in mind is one of the largest financial decisions a family makes. Test feasibility early, and get a builder involved before the design process begins.
We've been helping Melbourne families find, assess and transform inner city homes since 2014. If you're considering a property and want to understand what the design and build process looks like from the very beginning, we'd love to have that conversation.
Contact Sustainable Homes Melbourne or call us on 1800 683 697.
