How Much Does a Home Addition Cost? [2024]

Australian home owners are serial home renovators - it seems we just can't help ourselves. If we have a home, we want to tinker with and improve it, which is natural. Or you may like where you live but need more space, or increasingly, not be able to afford to move or upgrade because of prevailing property prices.

No matter the size of your home addition project, we can safely assume it will be a costly undertaking. Which is why you need to know upfront if you can you afford it, and how much it is all going to cost.

Planning your home addition

The first step is to do your research and decide what you want done. Then you can begin to work on the scope of the project, get plans produced and decide on what level of finish you want. This will enable builders to give you an accurate quote and tender for your job.

An architect, drafter or building designer can all produce working drawings and plans for your home. Architects are best qualified for larger more complex jobs, while the other two design professional are better suited to smaller projects.

Building approvals and red tape

After your house plans have been produced they need to be submitted to council for approval. Depending on your project a Development Application (DA) and/or Construction Certificate could be required. Once these are approved you can then arrange for builders to tender on your job. The approval process also differs from council to council, and could take anywhere from 30 days to 100 days. The best way to ensure that your application will be processed quickly is to have all the right information and documentation in your initial submission. Your builder, architect or building designer can also help with this.

Learn more: How Much Deposit Should I Pay My Builder?

Understanding building contracts

When you have chosen a builder you will need to sign a contract with them. This is required by law and is there to protect both your interests. You will need to decide what sort of contract to sign with your builder - standard, fixed/lump sum or cost plus.

• Standard

You can buy a standard contract in kit form from organisations like the Master Builders Association (MBA) and Housing Industry Association (HIA). These tend to be better suited to simpler, small scale projects - so avoid this if you are undertaking a larger, more expensive and complex job.

• Fixed or lump sum

This is the most common type of contract, and sets out your final cost up front. Your builder is likely to want to include a clause for variations, to cover items which are not yet known, so look to put a cap on the amount.

• Cost plus

This type of contract has no limit in terms of the budget, with the builder putting his margin on top of the price of the materials. You need to trust your builder and have more flexibility in your budget.

Read: Your essential guide to building contracts

How to budget for your home addition

Some factors that will influence the cost of your home addition include site conditions, level of fit out, red tape and design considerations. Rather than "guesstimating" begin your cost estimate by:

1. Calculating the square metres of your addition
2. Finding out the average square metre construction costs in your area.
3. Multiply the average cost per square metre by your calculations in Step One.
4. Write a detailed list of other costs. Don't forget to include labour costs, council approvals, flooring, heating, windows, doors and other materials.
5. Add a buffer of 10 to 25 percent to your total.

If you are comfortable with your cost estimate, you are ready to start spending a little money to get a more accurate cost estimate. You will need to supply council with detailed plans in order to get building approval, so now is the time to find a good architect, drafter or building designer to flesh out your plans. Whoever provides you with your plans will also be able to give you invaluable advice about ways to improve your design, save money on materials or add further improvements that may enhance the addition and the value of your home. A preliminary drawing may be all you need at this stage. You can save the detailed drawings for later, when you're ready to submit your plans to council for approval.

Calculating your building costs

As a guide to the breakdown of your total costs for a major job like a home addition, expect to pay:

• 50% for materials
• 35% for labour
• 15% for council fees and permits

In terms of a square metre costing, expect to pay in the region of:

• $1200 to $1600 per square metre for brick veneer
• $1300 to $1680 per square metre for full brick
• $1480 per square metre for timber frame

For ground floor home extensions, expect to pay:

• $1350 per square metre for timber
• $1500 per square metre for brick veneer

If you are adding another level to your home, expect to pay:

• $1900 to $3000 per square metre

Learn more: Guide to building costs in Australia

Hiring a builder

When it comes time to hiring a builder for your home addition make sure they are right for your job. Some questions to ask them include:

• Are you appropriately qualified and registered or licensed?
• Do you hold valid insurance (professional indemnity and public liability insurance)?
• Do you have experience in residential projects, specifically home additions?
• Can you provide a written quote?
• How long will my job take?
• Do you have references I can follow up?

After you have drawings and a firm idea of the material costs for your home addition, you can get quotes from local builders. Armed with three quotes and your own careful costings, you will be prepared to commit yourself to your home addition job with more confidence.