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Delaying your build isn’t saving you money - it’s costing you time, options, and peace of mind.
The following is a fictional story inspired by hundreds of conversations we’ve had with families just like yours…
Michelle & Paul still remember the big ideas and dreams they had for their home in Fitzroy when they bought it back in 2013. It was only the second home they ever purchased but this is the home they would spend the best years of their life in.
Paul set the goal of renovating the home to be energy-efficient and resilient within 3 years but life got in the way. After just 18 months of living in the home their first daughter, Sophie was born. Just over two years later along came Jack, their son.
Time flew by those first few years and the next 10 years went by even quicker. Jack’s just turned 9 years old and Sophie’s almost 11 now and high school seems to be coming along too quickly and the home seems to be shrinking in size each year.
Michelle grew up in Adelaide and her mum comes to stay over for a week or two at least 3 times a year. The house is always so cramped with 5 people living in it and Sophie is beginning to despise Jack when she has to share a room with him while Grandma stays over. - The kids are both getting to that age where they need their own space, especially Sophie, she’s grown up so quickly and she’ll be in high school next year!
Any downtime Michelle gets she spends it scrolling through realestate.com, dreaming about the perfect sustainable home, but it doesn’t seem to exist. All the homes Michelle gets excited about aren’t quite right or are sold for way more than the ad says!
Meanwhile, Paul always thinks ‘if only we’d renovated before Covid and inflation hit the cost of construction and house prices!’
They’ve been putting off this renovation for years and it’s getting to breaking point!
The last time Michelle & Paul got the chance to sit down, like ‘grownups’, and plan out what to do with the renovation was back in 2022. They set the budget of $800k and felt good about it.
Michelle’s best friend, Ash in Brunswick had just moved into their newly renovated home which was gorgeous. It had all the mod-cons; hydronic heating, an incredible indoor/outdoor connection, plus it was all-electric and energy-efficient - the kind of future-proof, sustainable home Michelle always imagined!
Apparently, it had cost them a little over $700k - well that’s what Michelle was told anyway!
But that was 2022 and now it’s 2025. Construction costs haven't been in the news as much lately but Paul being an Accountant knows it would be too optimistic to think construction costs had declined.
Since that ‘grownup’ conversation in 2022, Paul and Michelle hadn’t made much headway toward their renovation. Life still kept getting in the way. Though, it was coming to a crunch point and Paul got wind that one of the other Dad’s at under 9’s footy worked in the construction industry. Ian was his name, though Paul and Ian had only exchanged a nod and a quick ‘G’day’ once or twice.
That next cold Melbourne Sunday morning footy game Paul asked “Ian, have you got a sec? I really need some advice.”
“Sure.” Ian said.
Ian was really helpful and it turns out he was a licensed builder, though he’d recently begun working for a design & build firm after work dried up for him post-Covid. He was now a Project Manager doing large-scale sustainable renovations and new homes.
Paul’s big question was “How are you seeing construction costs in Australia? Have they come back down yet?”
“Pfft, I wish!” Ian exclaimed. “They’re certainly more under control than they were a few years ago. We’ve seen things settle the past year or so but residential construction costs are still on the rise. This company I’m working for is watching their project budgets for new homes and renovations like a hawk. What we’re seeing now is that costs have settled down though are still rising at around 6% per annum, which is still a lot more than what we’re used to in the construction industry. Pre-Covid costs were only rising at 2% per annum.”
Paul, being exceptional at math, did a quick calculation in his head and realized that construction costs rising 6% per annum for the past 3 years means, their $800k budget should now be $952k. Though, Paul tried to play it cool, but let out a little shriek “Gee, really?”
“Yeah, but it’s nowhere near as bad as it was during Covid. Construction costs rose by over 30% in about 3 and a half years. That’s closer to 10% per year!
When I was building for myself during the Covid construction boom, I was getting a timber quote on Monday and it’d increased by Friday. It felt like we were living in some super-inflation society like Argentina or something!” Ian said.
“Wow, do you think construction costs may come down in the next few years or any time soon?” Paul cautiously asked.
“Not likely! A report by Arcadis was released late 2024 which forecasted construction costs in Australian capital cities were set to rise again between 30-40% from 2023-2028. Melbourne was predicted to rise by around 34%. Basically what it means is the 6% per annum increase we’re seeing at the moment is set to continue until 2028.” Ian said.
“Gee, that’s wild isn’t it?” Paul exclaimed.
Ian was a world of knowledge, after almost 3 decades in the construction industry it seemed he knew it inside and out.
Paul explained. “Yeah, it is wild. But if you’ve been in the industry as long as me you can see why.
Think of it this way;
So, the big issue here is that demand is surely picking up from consumers gaining confidence and we’ve simply fallen way behind in supply of homes to keep up with population growth, meanwhile, builders and construction companies are going bankrupt at record rates.
Understanding all this, there's really only one way that the cost of construction can go!”
A look of regret came across Paul’s face - ‘I wish we built years ago’ - Paul thought except he said. “Well, when you put it that way it’s pretty obvious. Michelle and I have been thinking about renovating our home for years. We really need another bedroom and 1 bathroom isn’t going to cut it with a teenage daughter and son. Plus the house is falling apart in some areas.”
“Yeah, alot of people have been holding back like you. If you really want to do it, the sooner the better.’ Ian said. ‘You may have missed out building before the boom pre-Covid but don’t miss the next one!”
“I hear you.” Paul expressed. "Say, does the firm you work for renovate?”
“We sure do. We also employ architects so it’s a complete design and build service! Plus everything we do is centred around energy-efficient and sustainable homes that are resilient for the future.” Ian replied.
“Oh, that sounds great, Michelle has always dreamed of working with architects and having a sustainable home! We have all these big ideas and I think we’re going to need plenty of guidance!” Paul expressed.
While Paul and Michelle’s story is fictional, it echoes the real experiences of countless families - we share it to help you avoid the same delays and missed opportunities.
Ready to make up for lost time like Paul and Michelle? - Let’s help you avoid the next missed opportunity.
📧 Reach out to us via hello@sustainablehomesmelbourne.com.au
