Cost of Building a House in Sydney

July 25, 2022
Cost of Building a House in Sydney

Many folks making the move to Sydney are now choosing to forego finding homes for sale in Sydney and opting to build their own unique house instead. According to the Australian Bureau of Statistics (ABS), the average cost of buying a house over the last fifteen years has been around $320,000.

However, the current cost is likely higher due to supply chain issues and the high construction costs caused by the COVID-19 pandemic. 

In 2022, ABS reported that the average cost of building a house was $473,000. From the size of the house and cost of the land on which it’s built to its location, fixtures, and finishes, many factors affect the cost of building a house in Sydney.

What’s the Cost of Land in Sydney?

The first thing you should consider when determining how much it costs to build a home in Sydney is the cost of the land you’ll build the house on, which varies significantly across Australia. In 2020, the Urban Development Institute of Australia reported that in Sydney ,the cost of land was $495,000. In Adelaide, it was $183,460, and in Melbourne, it was $319,000. 

The average cost of buying land in Sydney, Australia, is $1285 per square metre, $400 per square metre in Adelaide, and in Melbourne, it’s $819 per square metre. 

What’s the Cost of Building a House in Sydney?

Cost of Building a House in Sydney

Although many factors influence the cost of building a house, including site, location, design, and finishes, Hipages estimates the cost of building a home in 2022 ranges between $1300 and $3900 per square metre. However, that figure excludes planning permits, design, site works, and blow-outs costs. 

The ABS reports that the average house in Australia occupies 248 square metres, putting the average cost of building a home at $322,400. 

What Factors Influence the Cost of Building a House?

Four key factors influence the cost of building a home in Australia:

  1. Size of the House

A report by Commsec estimates the average house in Australia is 195.8 square metres, sits on 470 square metres of land, and has three bedrooms. However, the size of new builds is considerably larger at around 235.8 square metres, meaning that people in Australia are now building bigger houses.

A larger home with many bedrooms will require more materials, specialised equipment, and labour, increasing the construction cost.

  1. Quality
Cost of Building a House in Sydney

Often, everyone’s idea of quality is different, so you must reach an agreement with your builder concerning the finishes and fixtures you want. Although high-quality materials result in better craftsmanship and finishing, which increases the cost of building a house, the reverse could also be costly.

By choosing cheap and low-quality materials, the ultimate construction cost may increase because you’ll likely have to pay for replacements and repairs later on.

  1. Timeframes

Timeframes also influence the resources needed for a build. Amid supply chain problems, budgets and timeframes are being stretched because of shortages in materials across the country. When there are delays in materials, your entire project stalls, which means you’ll pay more in accommodation and holding costs.

Further, your builder will divert their team of tradespeople to work on other construction sites, which means it’ll be challenging to get your project to align again.

  1. Site Considerations
Cost of Building a House in Sydney

Site is a crucial factor that your builder or architect has to manage–often with the assistance of an engineer when necessary–and the cost will be out of your control.

If you need to reduce the cost of building a home, trading off on the quality of the foundation is a bad idea because you can always refurbish your floors and doors in the future, but you can’t refurbish the concrete slab. The location of the house can also affect the cost of building a home due to planning overlays and council requirements.

  1. Design Complexity

A simpler construction project is less costly and takes less time to complete, while more complicated designs are expensive and take longer to complete. Budget and timeframe blow-outs are expected when building houses and are often caused by changes to the original plan.

If you’re building your home with a volume builder, it’s cheaper to stick with the standard inclusions.

Remember, if you opt to update the existing inclusions, including adding more insulation, storage, or luxury flooring, this will increase the cost of building your house.

The average cost of building a house in Sydney in 2022 is around $473,000; however, that cost may increase depending on land cost, house size, quality of the house, and overall complexity.

Not interested in building and looking for details on the process of buying a house in Sydney or the cost of a buyer’s agent in Sydney? We’ve got you covered–check out our latest articles.

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