Building a new home can be a daunting task, with costs adding up quickly. However, there are many ways to reduce costs without cutting corners. There are a few simple ways to save money without compromising on quality.

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Keep It Simple

Don’t be tempted by the state-of-the-art Kitchen complete with breakfast nook and bar or overdo the height of your ceiling. Keep it simple and use a basic rectangular shape to create a smart, elegant and functional home without excess. The simpler the building line, the cheaper the build. Many of today’s best-looking homes are constructed in simple, space shapes with fine proportion. You can save money by keeping your plans as simple as possible, which will also appeal to the widest range of buyers down the road. Think about the placement of your wet areas. When all your wet areas are strategically placed together, fewer pipes are required, which will save you money.

Keeping It Low Maintenance

Investing more money now on high quality materials can help you save money as a home owner down the road. Don’t cut corners with cheap roofing material, windows and external finishes. All this will mean is you will probably have to replace them sooner than later.

Keep It Sustainable

As with choosing high quality material to reduce maintenance costs, choosing sustainable material will help you save on your energy bills. Installing plenty of insulation and facing your home in a way that lets it take advantage of surrounding light and shade will help you create a tight, energy efficient home that can save you bundles.


Keep It Professional

Another issue is that you might be tempted to cut corners by hiring a contractor who charges less. It doesn’t always pay off going for the cheapest contractor in some cases it may work out a lot more expensive in the long run. Builders who have experience and a network of subcontractors, may charge a bit more, but they more than make up it with efficiency and service. By planning ahead with a strict budget and choosing a reputable contractor to work with you can keep costs in line.

On a finishing note if you are on a tight budget, leave a few jobs until later on, such as fencing and landscaping, they might even turn out to be fun for all the family.

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Building a new house is a daunting experience. Combining all the features and fittings you want into the perfect home and doing it all on a budget, can be far from easy.

Regardless of whether you’re building your own home or an investment property, the key factor determining all your decisions is cost. You want your new home to be as affordable as possible and you don’t want to get ripped off by any dishonest builders or tradies who think they can get away with overcharging.

A “cost per square metre rate” is a method of expressing building costs that should be used with extreme caution by both clients and contractors involved in the cost comparison and cost planning process.

There are a number of design aspects which can unfavourably influence square meter rates, therefore giving a false impression of the cost of a building project and this can lead to serious problem for both clients and contractors. “You would not compare a Porsche to a Volkswagen on their cost per square metre, so why try and do it with buildings?”

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How much does it cost to build a house per square metre?

This is difficult to answer because there are lots of factors that affect how much it costs to build a house. Site costs, such as sloping land, as well as the specifics of your home, such as materials used, quality of inclusions, design and layout, make it impossible to quote a one-size-fits-all figure.

Very few Australian builders are willing to quote based on per square metre. I would strictly forbid consumers making decisions based on price per square metre. It’s the quality of inclusions that matters. The scope for variation in square-metre building costs is huge.

For a much clearer idea of how much it will cost to build your house, you’ll need to have detailed design and construction plans drawn up to get a detailed quote. These will consider all the specifics of your project, from any site requirements through to the size, layout and features of the build.

Just make sure you know exactly what is included in the quote from your builder and what may cost extra. For example, site costs, carpets, driveways, landscaping and fencing are often not included in quotes but can add thousands of dollars to the overall cost.

Volume builder vs custom builder

Although it’s not always the case, volume builders are usually nationally owned companies that have completely systemised their home-building process. The main feature that attracts people to use a volume builder is their extensive range of floor plans that are already priced out, catering to budgets ranging from standard to luxury.

Volume builders work on a standard inclusions and upgrade scale where you can add and subtract according to your budget. It’s a very simple option for people who want someone to take care of the whole process from start to finish.

When you choose a volume builder, every aspect of the build is typically finalised before construction starts. Every single detail is set out right down to the colour of the paint on your walls. “If you are someone who likes to improvise and change things as you go, you might be better suited to a custom build.

Custom builders are usually hands-on local tradesmen who pride themselves on the personal quality and uniqueness that they can bring to your home building experience. Custom builders suit people who like the idea of having some level of involvement in the home-building process, though that is completely optional.

If you choose a custom builder, you have the freedom and flexibility to improvise and adjust along the way. Although many custom builders have a range of plans available to inspire you. A custom builder will often work alongside clients during the design phase of their home. Custom home builders generally focus on high standards in design principles and construction of your new home, meaning you will have a quality-built home with a high-quality finish.


If you don’t want a unique, one of a kind homes and you want the cheapest price, while maybe compromising on quality, then a project home builder who works to a square metre rate is best suited for you.

However, if you want a unique design taking in all aspects of your block and you want as much input as possible into the design and don’t want to be limited to choices when it comes to material used and want that high quality finish, a custom builder is exactly what you need.

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If builders are adding tens of thousands of dollars in profit to every contract they sign, why are so many of them failing every year?

In this article you’ll learn the truth behind house prices and who is really making money in the construction industry… You’ll discover the truth behind house prices and why it costs so much to build a new home.

While it may seem like home builders get paid a lot of money and do very little, the truth is a little different.

In fact, the average building company makes little or no net profit, a fact that should alarm you if you are considering building a new home.

It’s for this reason you really don’t want to be choosing the builder with the lowest price unless you are prepared to finish the job yourself when they go out of business!

While most building companies make less than 1% profit on each contract, the government earns a whopping 10% in Australia just from the GST! That means, on a $500k contract $45,454 of your investment will go to the government in tax.

Next is the home warranty insurance. This is a compulsory insurance that has to be paid when building a new home. Your builder will take care of this for you and generally they will include it in the contract price, but it’s probably costing you around 1.5% of the build as a rough guide so there’s another $7,500 that disappears.

Then there is the long service leave levy which is also collected by the government and that will cost you another half of a percent, which is around $2,500.

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So, in reality, out of the $500,000 that you are spending on a new home, only $447k is actually going towards building it.

But that’s not the biggest expense…

The biggest expense is the labour and materials to build the home, so how much should that be?
This is where it gets really interesting because not many people know this!

In fact, a lot of home builders don’t even know this which is why they end up signing cost plus contracts!
A cost plus contract is where the consumer… i.e. you… pay for everything associated with the build including materials, labour and supervision… i.e. the builder’s wages… and then pays the builder an additional margin of around 15% on top.

But the problem with a cost plus contract is that you are effectively giving your builder an open cheque book…

And with standard industry discounts available to home builders of between 20%-40%, how hard do you think they going to negotiate in order to get a better price for you?

So, although paying a builder 15% on top of cost might seem like a good idea at the time, you’ll probably end up spending a lot more in the long run.

But when you deal with a professional builder, one that knows their numbers you don’t have that problem. You agree a fixed price for a fixed outcome on a fixed date.

If prices go up, the builder pays. If there are delays, the builder covers the costs (and may even have to pay you for each day the home is late)

To cover this risk and extract a profit the builder that offers a fixed price contract has to negotiate discounts of around 30% across all labour and materials in order to operate the business at a profit.
Typically, a building company will be offered significant trade discounts by their suppliers in return for ongoing business, sometimes as high as 40-45%.

It’s the same with their subcontractors, in return for continued ongoing business, some trades will discount their labour by over 25% in order to receive regular work.

If you compare that to a cost plus contract where the builder has no incentive to negotiate any discounts at all because the more you pay the more they earn, you could end up paying tens of thousands of dollars more for the same home.

It may seem like a minefield you’re stepping into, but with the right builder building a new home is an exciting experience that you will want to repeat.

The trick is, to make sure you choose the right builder…

And that means you need to ask the right questions because better information leads to better decisions.

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Don’t assume every floor plan will fit your family and lifestyle. Builders put a lot of planning and thought into all of their floor plans however this doesn’t necessarily mean it will be exactly what you need.
Check the room sizes on the floor plan are adequate for you. Consider furniture layout and use. Just as you might find a bedroom is too small for the double bed you need to put it in, sometimes rooms can be larger than you actually need.

When viewing display homes, in your mind, try to strip away all the upgrades and visualize the floor plan without getting distracted by the beautiful benchtops, sleek taps and gleaming bathrooms.
Ask whether the builder will allow changes to the floor plan to suit your requirements and if so, to what degree. Find out exactly what is adaptable, and what is set (like structural changes).

Measure a space from the floor plan in real life. This can help you feel the proportions of the space compared to your furniture etc. It’s handy to measure it in reference to your actual current spaces so that you have a reference point. For Example. Stand in your current bedroom and measure your new bedroom. Is it smaller or larger than what you currently have? From this point you can imagine how you will fill the space in the new floor plan.

Builders design a floor plan in a certain way for good reasons – energy efficiency, orientation, privacy, best use of space, usability etc…So if you want to change it, discuss with the builder to understand the pro’s & cons of any changes you want to make.

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YOUR CHECKLIST – [Before you sign off on your plans & specifications]


Ceiling heights: Check what ceiling height is included in the base house price (usually 2400mm). Consider increasing your ceiling height to at least 2550mm, you will be surprised at the instant feeling of space.

Cornices: There are different types of profiles available but also consider ‘square set’ which is where there is no cornice. This is cleaner and more modern looking but will often cost additional.

Internal doors: By increasing the height of your internal doors, you can dramatically change the feeling of space. It is a visual trick that makes you feel like the ceilings are higher than they actually are.

Windows: Check the window type on the plan (awning, sliding, casement, double hung). There are pros and cons to each window type – for example, awning windows protect from the rain, but they offer less ventilation. Windows should be placed to take advantage of prevailing winds and to maximise cross ventilation with another window or doorway. Are they single or double glazed? Do they have weather seals to increase thermal efficiency?

Insulation: What is standard? Depending on where in Australia you live you may want to increase insulation within the house.

Paint: How many paint colours are included? Often it is only one… How much is it to have multiple colours?

Storage: Is there enough? Consider using spaces such as under stairs, under floor, under bench seats for example. Can you take a bit of floor space from the entryway for more storage? Could you, clever pull out shelving increase utilization of space in the kitchen?


Joinery: What shelves are included? Is a bank of draws included? Pot draws? Overhead kitchen cupboards? Built in space for microwave? Do you want soft-close drawers? Will the fridge space fit your fridge?

Layout: Do you have adequate space to prepare food? Where would your chopping board go? Where would your appliances sit? Can you carry hot pots to the sink easily? Have you considered the kitchen work triangle? Imagine entertaining and having a few people over. Can you prepare food and speak to guests easily?

Plumbing: Do you need a water tap in the fridge space (if you are having a fridge with water/ice dispenser)? Consider a pull-down tap (especially if you have a small sink, it provides better flexibility).

Bathrooms / Wet Areas

Tiles: Are wall tiles in the bathroom included? If so, to what height? Often, they will only quote for half height. What pattern are the tiles laid?

Bath/Shower layout: When designing your bath/shower layout, consider: how do you get in and out of the bath? Can you turn on the taps without getting wet? Are the taps in a safe position for children? Can you lean up against both ends of the bath without taps in the way? Is the shower head/rail high enough?

Accessories: Check placements of toilet roll holders and towel rails to make sure they are accessible and don’t get in the way

Toilets: Is there a toilet easily accessible from living areas? Does it offer noise privacy?


Robes: How many shelves and rails are included? Sliding mirror doors can be more expensive than wooden opening doors, however if you have a small space, they will be more practical.

Bedrooms: Check the sizes of the rooms. Is it large enough to fit the size bed you require? Some small bedrooms are not configured for more than a single bed. Plan where the windows are situated to suit your furniture layout.

Bedroom placement within the house: Depending on what stage of life you are in, you might want to consider alternate placements. If you have a baby (or are likely to have one in the near future), you might want a small bedroom near the master (rather than at the opposite end of the house). If you have toddlers, is it easier having their bedrooms downstairs?

Electrical (watch for budget blow-out!)

Get an electrical plan done at quoting stage. You will always need some level of customization, and it is a common area for budget blow out, so plan for this early on in the process.

Power points: How many power points are included? Often you will need to add in additional points, so factor this in. Don’t forget power points in hallways (for vacuuming), near the bathroom vanity, beside the couch for lamps, beside the bed for lamps, outside alfresco areas, multiple locations in the kitchen (including on an island bench), charging stations for laptops/phones and in the garage.

Lighting: How many lights are included in each room? What type of lights are included? Do you need dimmers (for living spaces is common) or two-way switches (for long hallways for example)? Imagine yourself in each room – where would you turn on and off your light switches? Can you see into your robes/cupboards? Imagine lying in bed, standing in front of the mirror etc… Think about the use – practical light (brighter), ambient light (not direct), task light (direct). Consider the orientation of windows in each room to understand how naturally light or dark they will be.

Data points: Are data points and TV antennas in the right place?

Heating & cooling: Is anything included? It is easier to heat/cool smaller spaces, so consider hallway doors to section off parts of the house for heating/cooling purposes.


Most homes don’t include flooring as the standard. Get this priced up early in the process.

Consider stairs if you have small children. Can you put a gate across them if you need to?

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Outdoor (watch for budget blow out)

Outdoor: Are garden taps included? What degree of landscaping, retaining walls, fencing, decking or ground cover is included or what is the additional cost?

Driveways: Is it included? If so, what style of driveway is it? Is there a path to your front door?

Garage: What kind of door is included? Is insulation included in the garage (if you are using this as a workshop, it might be handy). What are you going to use your garage for? Do you really need a double garage, or could you move the garage forward and put a storage room behind instead?

Alfresco: Does the outdoor living seamlessly connect with the indoor living?

Storage: Where do you store things like bikes, lawn movers?

Choosing the floor plan is an important decision, however, take into consideration the location and orientation of your house on the block. A floor plan could look good on paper, but did you consider the outlook from your windows for example. The perfect floor configuration might not be as desirable if the outlook isn’t what you’re expecting. Make sure the plan fits with your block.

Click here to find out The 7 Things you must ask before signing your building contract

Building a home can be a very demanding exercise; at the least because you don’t want to forget anything that you will later regret and you don’t want to burden yourself with an excessively high mortgage you can’t afford.

Unfortunately, many home owners who design their new home or select a house and land package from a builder, wish that they had spent much more time researching home designs, appliances and floor plans before signing on the dotted line.

This is because changes during construction can become very expensive, often forcing you to choose between having the home you want, at a higher cost, or putting up with a home that isn’t your ideal, just to stay within budget.

We can all agree that the best way to build your dream home and have no regrets is to plan ahead early and stay within your budget. To help you build your perfect family home, here are five areas that you need to consider thoroughly, before construction starts.

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The biggest regret of most home owners is that they didn’t spend enough time researching what they wanted vs. what they could afford. Building a home on a tight budget is achievable however you need to focus on key areas, so that you can fit everything comfortably within your budget.

For example, would you be happy with a smaller home that has top of the line fittings or a larger home that has more moderate fittings? These are the things you need to consider, before settling on a builder and committing yourself to building a new home.

Remember, if you suddenly change your mind during the construction process, you will lengthen the completion process and need to find more money from your lender to cover these design changes.


Floor Plans:

Another major regret of homeowners is that they didn’t spend enough time thinking about the floor plan and how they would actually live in the house. Many homeowners thought that they had considered their future circumstances and needs well enough however in hindsight they realized that they hadn’t spent enough time in this area.

For people with a growing family, it can be hard to decide on a floor plan; often settling for a large open floor plan. You might think that this is the best design for your home but when you have three or four children in your family, having separate spaces and living areas can make a huge difference to everyone’s home comfort.

Don’t forget that the homes we build today are much bigger than in our parent’s time, when the open plan concept gained ground. This means that you should have enough floor space to consider an open plan kitchen and dining area for example, with separate living spaces as well.

Storage Space:

Yet another element often overlooked by many homeowners is a lack of storage. This can be a difficult feature to anticipate however a good rule of thumb is to think about storage in every room of your home, including the garage.

New Appliances:

If you want top of the line appliances and fittings, you might have to either increase your budget or make allowances somewhere else in your home’s design. For example, some homeowners prefer a smaller home and/or block of land, because they can then afford a home that is built to their specifications and filled with the best appliances and fittings. Others prefer to exchange the top of the line appliances and fittings for a bigger home and land parcel.

Electrical Outlets:

Wiring your home for every eventuality might seem a bit over the top but the best time to do this is when you don’t have any walls. Adding extra power outlets in rooms always comes in handy, particularly in hallways and bedrooms.

Therefore, think about your multi-media needs of the future, as well as in-wall speakers, computer stations, wall lamps, and lots more. Forgetting to locate an outlet in the hallway, so that you have to keep unplugging the vacuum cleaner because the cord isn’t long enough, might become very irritating in a year or so.

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