The huge popularity of home renovation and DIY TV shows have inspired many Australians to pick up a sledgehammer and renovate their own homes. But if living on a construction site and getting hands on isn’t really your thing, renovation isn’t the only way to go if you want to upgrade your home.
Knocking down and rebuilding definitely has its advantages over renovating, as does renovating over rebuilding. So, if you’re stuck between deciding to renovate or start over and rebuild, we’ve collaborated with real estate portal homely.com.au to learn about the key factors to weigh up before making your choice.
For Sale: 3 Sydenham Street, Seddon, VIC
When it comes to comparing the cost of rebuilding vs. renovating it really comes down to what you want to achieve. If you’re planning a major overhaul of an existing home, rebuilding could end up being the more affordable option. But if you’re just wanting to add or do-up an individual room or two then renovating is obviously the more cost effective way to go.
The advantage of a rebuild is you can get a fixed-price contract with the builder so you know from the outset exactly what it’ll cost you. With a reno the budget can easily blow out due to unforeseen complications that are common with older homes (such as rising damp, mould, termites or hazardous materials) that are very labour intensive and costly to rectify. If you go down the reno path, make sure you add a contingency to your budget for nasty surprises that are almost certain sure to come up.
If you’ve fallen for the archways, ceiling roses, ornate cornices and period fireplaces of an older character home renovating is really the only way to go. A disadvantage of new builds many would say is that new homes cannot replicate the soulfulness and charm historic homes have. Before diving into a renovation of an old home check whether the property is heritage-listed or subject to heritage overlays as these will heavily restrict what kinds of changes and enhancements you can make.
For sale: 110 Vale Street, East Melbourne, VIC
Location, location, location
A great thing about rebuilding is that you can get your dream home in your dream location, whether that be bayside or in a trendy inner city suburb, where vacant blocks of land are highly scarce and your chance of overcapitalising is low. Before buying an old place to tear down and rebuild, always check with the local council to make sure you can do what you want to do on that piece of land.
When starting fresh and opting to rebuild a home from scratch you can really make everything about the home your own. You can select the layout, materials, finishes and fixtures that suit your own lifestyle, personal taste and budget requirements. Whereas with renovating you’re largely restricted by the bones of the original home and the choices the first owners made.
When you build a new home, its ‘newness’ is a great advantage in terms of the ongoing expenses of maintaining a home. By law new builds come with a structural warranty of 5 to 7 years (depending on the state or territory) which gives you peace of mind if any issues come up down the track and you won’t have to foot the bill.
Also, new homes will always be more energy efficient than renovated homes, saving you on bills and running costs for years to come. New builds will use the latest building materials and energy-efficient devices, and be constructed in line with the latest building standards requiring new homes to have a minimum of a 6-star energy rating.
For sale: 1/2 Kaarumba Grove, Balwyn, VIC
Grants & savings
If you’re a first home buyer and you build a home you’re eligible for the Australian Government’s First Home Owner Grant of $7,000 plus any grant your state or territory offers first time owners. If you buy an established home to renovate you miss out on these allowances.
First home buyers looking to buy and build a home off the plan are also eligible for stamp duty concessions up to a certain contract value. Check out what FHOG and stamp duty savings you might be entitled to in your state or territory at firsthome.gov.au.
Renovating is extremely high involvement and you’ll have to be on deck to advise your builder and tradespeople on every little decision. Whereas you typically aren’t allowed on site while your new home is under construction and the site manager will take the reins on driving the project.
During the building phase of a new home you’ll have to arrange and pay for off-site accommodation and storage for all your stuff. For those renovating that plan to live on site you have to consider whether you’ll have access to the bathroom and kitchen, the security of your belongings and live day-to-day with the noise and mess of a construction site. For some people this hassle just isn’t worth it and living off site is the more practical option.
Coming to a decision on whether you’re better off renovating or rebuilding is a tricky and expensive one either way, with many pros and cons to weigh up for your own individual circumstances. We hope these tips have helped clarify which option will work best for you.
For more advice on renovating vs. building view the pros and cons of building your first home and key considerations when buying a renovators delight.
Larissa Gardner is a blogger, social media strategist and marketing coordinator at
arguably Australia’s best looking, banner-ad free real estate website homely.com.au. With a superb devotion to product innovation, user-centred design and innovative marketing platforms for real estate agents, homely.com.au helps millions of Australians find their next home easier and faster than ever before.