How much does it cost to renovate or build a home in 2024?

May 20, 2024 | News

If you’re trying to work your way through the costs of building or renovating a home, you’ve no doubt faced the question; what should my budget be? And, how can I keep my renovation on budget?

It can be a challenging question, though the worst thing you can do is keep your budget to yourself—especially in the 2024 market environment.

It’s important from the outset to surround yourself with experts with practical knowledge and a proven track record in completing a project similar to yours.

There’s only 2 approaches I’d recommend to you when building or renovating your home. Especially if it’s your forever home or a home you intend to live in for many years or decades.

Each of these approaches is based on achieving a home that we deem as sustainable, meaning; it’s a comfortable, healthy and energy-efficient home.

Approach 1: Engage a Design and Build Company

The first approach to support budget management that I’d recommend as an experienced builder, is engaging a design and build company (just like Sustainable Homes Melbourne). There’s many advantages to the approach of a design and build company, particularly when it comes to renovating or building in 2024.

First of all, like us, most design and build companies are builders first who recognise the importance of good design and have added design to their suite of offerings.

The reason that is good for you is because; design is not their primary business objective and ensuring projects enter the construction phase is.

This incentivises a design and build company to do everything in their power to get your project in on budget. That means open and honest communication from the outset giving you the best chance for your home to be built.

“70% of home designs are never built”

With the combination of design and construction under one roof there’s a much more collaborative approach finding ways to economically produce exceptional results.

Also having a construction team involved early with design can remove many of the nasty surprises that arise when building, especially renovations.

You might be surprised to hear that between 50-70% of home designs are never built. This is a tragic stat’ heard in the building industry and one we should not be proud of. It is certainly a number that we’re doing our best to turn around at SHM.

Approach 2: Hiring an Architect

Experienced builders recommend hiring architects with caution, because the fact is pretty well all the 70% of plans that don’t make it to construction are designed by architects and most of the time designs are put through the paper shredder because they don’t meet the client’s budget.

Therefore, at Sustainable Homes Melbourne, we only recommend this approach if you have a generous budget for your sized project and you’ve got a good amount of wiggle room. For those that are budget conscious, a design and build company is your better choice to keep your renovation within budget in 2024.

I’ll digress: It’s important to understand the role of an architect in the creation of your home; an architect is the visionary to the creation of your new home or renovation. The best architects have refined their process for creativity and are able to bring that into your new home or renovation.

An architect is never the best person to provide guidance on the cost of your project or the way it should be built.

“An architect is never the best person to provide guidance on the cost of your project”

If you do decide to engage an architect you should always engage a builder who has a track record and experience consulting in the early stage of design. This is your best chance to ensure your project stays on budget.

At Sustainable Homes Melbourne, we collaborate with architects – either inhouse or within a partnership arrangement.

Critical advice: The builders worth their salt have experience working with clients early in the design process under an Early Contractor Involvement (ECI) agreement.

If you don’t heed my advice on this as an experienced builder that has been building and renovating homes in Australia for 10+ years, you may as well get fed to the wolves. And, you’ll only have yourself to blame.

We’ve seen so many people come through our doors with plans they’re really excited about, then we ask about their budget and the budget is nowhere near where it needs to be.

Don’t let this be you: We had someone come to us recently with a beautiful set of architectural plans, having spent the past 3 years working on them to go out to tender with prices coming back 3 times over budget.

After spending so many months or years working with an architect to develop a design and falling in love with it (not to mention the $$$ spent) to find out the design is so far from budget is devastating!

Industry Collaboration is Key

To keep your renovation or building project in 2024 on budget, prioritise collaboration between the design and build team. Think of it as a relay race: architects and designers rapidly advance their creative concepts like a train speeding towards its next station. Once their design phase concludes, builders, stepping in with practical insights from the field, must take the baton and bring these designs to fruition. However, without proper budgetary considerations from the start, this handoff can lead to projects being shelved, a scenario too common in our industry. Emphasising collaboration from the onset is essential for ensuring that designs not only meet creative standards but are also realistically executable within budget constraints.

Are you considering a renovation project for your home in 2024 and want to ensure it’s within your budget? We’re proud of our team bringing life to tired homes using a proven, integrated design and build process that’s not just design savvy but budget savvy.

Don’t let your project become part of the 70% that never marks it off the paper. Enquire today.

Simon Clarke SHM Director

Author: Simon Clarke
Simon is the Managing Director of Sustainable Homes Melbourne.

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