Real Estate

How much does it cost to knockdown rebuild or rehabilitate a house?

Obviously, one of the main questions that we are finding ourselves with when we start a process of knockdown rebuild or renovating a home is how much it will cost. It is one of the highest economic efforts that a person, a couple, a family or a group of people will make in their life and, therefore, it is understandable that they do not want to leave something so important to chance.

However, knockdown rebuild a house, rehabilitating an existing one or carrying out a reform is not like buying a washing machine, but rather it is about obtaining something personalized (even if we only tile the bathroom), that lasts over time, of high cost (although very cheap per unit of weight), with many limits for standardization and that has relatively traditional ways of being made.

It is logical that it remains so after thousands of years, certainly with many technological and analytical advances and improvements, but whose basic characteristics do not change. As much as from time to time it is tried to sell prefabrication as a panacea, the truth is that it is enough to look at any housing promotion to realize that it is not. Sometimes it is cheaper to prefabricate certain elements of a construction, without a doubt,

We are trying here to make a non-exhaustive summary for anyone who wants to knockdown rebuild a home or rehabilitate to live in it. Most of what we say here applies more to the first case, but we re trying to guide those who consider rehabilitation as an alternative.

Knockdown rebuild or rehabilitate?

This is a question that most people who decide to get into the project of a single-family home ask themselves. The answer is not simple because another question must be answered: rehabilitate what? And normally we still don’t have that what.

In general, rehabilitation implies deploying less energy and therefore lower cost, but if we start from a ruin or a stable without windows, it is most likely that the cost will be similar from scratch. We have to be aware of this when thinking about buying an existing building.

The purchase

Buying land or a building to rehabilitate implies a series of costs that we summarize below. This cost will in principle be determined by a series of variables (place, orientation, size, state, proximity to facilities and transport networks…) and obviously by what we can pay.

We are not going to go into this article to develop another series of questions that also determine the cost at the time of purchase, such as what urban planning regulations allow to be done in that place or in that building.

We have found “housings” that were sold as homes when they were not and perhaps could never be, or land where it was not possible to knockdown rebuild what was wanted. Such a situation can cause the market cost to be inflated and we may not even know it.

If we skip all those previous analyzes (in which by the way we can accompany you) and we have the chosen terrain, the following costs will appear:

  • Cost of land or building
  • Taxes (ITP or VAT + IAJD, which depend on the case and the Autonomous Community)
  • Notary and Land Registry

Read also: You need to know how to sell the lot for sale!


As we said above, the price of construction is very variable and will depend on the surface to be rehabilitated, the suitability of the project to be carried out, the level of equipment and qualities…

We must be careful with the construction cost ratios that we find on the internet or those that the builders can even advance us, since they may not be including all the necessary costs. The main ones are:

  • Construction cost, that is, what we pay the builder or Contract Budget (PEC) —not to be confused with Material Execution Budget or PEM, which is lower.
  • VAT: in new construction, 10%; in rehabilitation depends on the level of intervention according to criteria set by the Treasury and can be 21% (normal) or 10% (reduced rate)
  • Fees for technical studies: architect, technical architect, facilities and structure calculators, topographical and Geo technical studies and other external technicians that may be necessary or required. Your VAT is 21%.
  • Licenses, rates, guarantees and municipal taxes
  • Other expenses: connections, furniture…

OK, but how much is that?

Based on the variability described above, we could say that building a single-family home with a conventional surface area and qualities can be between A$1,000-1,500/m2 built approved (that is, taking into account all the exterior surfaces of the home, a percentage of porches, garages and storage rooms and a minimum of land conditioning).

Rehabilitating a home can cost from A$600-900/m2 up to the price of a new home if what we rehabilitate is in very poor condition… This is the PEC, that is, it does not include VAT. If you hear prices much lower than this, question them, something is not being taken into account.

The costs of the technicians are usually calculated based on the price of the construction. However, we do not do it this way, since we consider it fairer to calculate them based on the dedication in hours, our costs and our civil and criminal liability (fees, insurance…).

To serve as a guide, we can talk about A$150-200/m2 approved for a new home. In the case of rehabilitation, they may be minor, but it is depending on its scope because the work and procedures to be carried out can vary greatly depending on the project and the license law/regulations of each community and municipality.

To all this we must add VAT, taxes, fees…

We are hoping this article has been helpful to you. If you are thinking of knockdown rebuild or renovating, whether it is an individual home or a co housing group, and you want to know more about everything you need to knockdown rebuild a house or a community, do not hesitate to contact us. We advise and accompany you in the process of searching for land or housing and beyond…

Read Latest News on Cryptocurrency

Related Articles

istanbul escort
Back to top button
ankara escort