Knockdown rebuild vs renovate: Which should you choose?

You've decided that it's time for your house to get a fresh look - perhaps you've outgrown it, you've got a growing family, or you just want more space. Or you may have just purchased an older property in the ideal location and want to update it before moving in. You visualise the perfect home in your mind.

All the questions creep in. How much will it cost? How long will it take? Will you knock down your home and rebuild it, or will you renovate the existing property?

While these are important questions to ask, there are more factors at play than just cost and timelines. Exercise your due diligence ahead of time to put your efforts into efficient use. Here are nine important factors to consider when choosing between a knockdown and rebuild (KDR) versus renovation so you can achieve your dream home.

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Knock-down and Rebuild VS. Home Renovation: Questions to ask yourself before you choose

1. How much does it cost to knock down, rebuild vs renovation?

The most important concern for many is the cost of rebuilding compared with renovating. So is it cheaper to knock down and rebuild (KDR) or renovate?

Renovation per square metre cost

The cost of renovations per square metre in Australia can vary widely depending on a range of factors, such as the location, the scope of the renovation, the quality of materials and finishes, and the level of expertise required.

As a rough guide, the average cost of renovating an Australian home is about $2,500 to $4,000 per square metre, while a more extensive renovation with high-end finishes and fixtures can cost upwards of $5,000 per square metre. These costs typically cover labour and materials but may not include the cost of any design or planning services, permits, or other associated costs.

It's important to remember that the cost per square metre can also vary based on the type of renovation. A kitchen renovation, for example, can cost you up to or over $45,000; a one-bedroom house renovation can go up to as much as $140,000! And remember all the hidden costs that can come with renovation projects.

Rebuild per square metre cost

The cost of rebuilding per square metre in Australia can vary widely depending on a range of factors, such as the location, the size and complexity of the home, the quality of materials and finishes and the level of site preparation required.

As a rough guide, the cost of rebuilding in Australia can range from $1,500 to $3,000 per square metre for a basic home, while a more custom-designed home can cost upwards of $4,000 per square metre. These costs typically include labour and materials, as well as any necessary permits, site preparation, and associated costs.

The cost per square metre can also vary based on the type of building being constructed. For example, multi-story homes or those with complex designs may have a higher cost per square metre compared to single-story homes with a more straightforward layout.

2. How old is your existing home?

The age of your existing home is another important consideration. If you live in a beautifully-preserved older home such as a Queenslander-style home, you may go for a renovation to pay your respects to its history.

If the home is older and not built well, a renovation could uncover structural or other issues that may increase the cost of the work, making a rebuild a more viable option.

TIP: Check the age of your home by looking at the contract, sewer/drainage plan, and metre box (for the original installation date) or by seeking council records.

3. What is the condition of your existing home?

The state of your home can impact the feasibility and cost of a major renovation or knockdown rebuild.

If the existing home is in good condition and requires only minor repairs or updates, a renovation is more practical and cost-effective.

However, if the existing home is in poor condition or requires extensive repairs, a knockdown and rebuild may be the better option. This could include homes that have serious structural issues, water damage, or termite damage that cannot be easily repaired. A rebuild may be less expensive than trying to repair the existing home, especially if the repairs are significant and ongoing.

It's helpful to define the areas of your existing house that need a rework or remodel first. Is it an additional room or a structural change?

Existing home too small for your needs? Need more space at your place? Want a new home with a more contemporary look? A rebuild is a better option if the existing home is too small or requires modernising.

4. Are there council restrictions?

There are usually council restrictions on renovating or knocking down and rebuilding a property. These can vary depending on the local regulations, zoning laws and building codes.

For example, if you're planning to renovate your home, you may need to obtain a building permit from your council before starting the work.

Similarly, if you're planning to knock down and rebuild your home, you will need to obtain a planning permit and a building permit from your council. The council may have specific requirements for things like setbacks from the property boundary, maximum building height, and the percentage of the property that can be built on.

Tip: Houses on a flat block are generally easier to knock down and rebuild than houses on sloping blocks. There might also be vegetation or trees around the block that need to be removed, which may require a council permit.

5. What is the state of the property market in your suburb?

If you're in an area where vacant land is rare and close to highly desirable locations such as the city, beach or bay, knocking down and rebuilding allows you to stay in an area you know and love.

Take a look at the other properties in your area. Have homeowners been renovating existing houses or knocking down and rebuilding? Which option would set your home apart from those around you?

Seek guidance from a local real estate agent with an understanding of the local market conditions or review recent home sales for an idea of current market value.

Even if you're not planning on selling anytime soon, understanding what types of homes are popular with buyers can give you a better idea of features that may increase the value of your home.

6. Who will manage the project?

Many homeowners find renovation more time-intensive and laborious, especially if you have to source and manage contractors yourself.

Rebuilding from scratch is the best option for a significant home restructure due to the investment required in project management time.

As there are streamlined systems in place for building brand-new homes, your builder can look after project management.

Top tip: Having a single point of contact and leaving your home builders to manage the knockdown and rebuild project can ensure it runs smoothly and reduce stress for you and your family.

7. What orientation is your home?

The ideal scenario is one where your house has access to northern sunlight (especially in the living areas) - and access to solar light in general. A rebuild allows you to make the most of your position and optimise [home orientation](https://plantationhomes.com.au/design-and-building-resource/north-facing-house-orientation) even if the block is not north-facing.

8. How long will a rebuild take?

The time it takes to renovate a home versus knocking down and rebuilding depends on several factors, including the scope of the project and the materials used.

Major renovations such as changing the floorplan or updating plumbing and electrical systems can take several months or more to complete.

The timeline for a knockdown and rebuild project can vary depending on factors such as the availability of building materials and labour, weather conditions and council approvals. A complete knockdown and rebuild project can take anywhere from 8-12 months to complete.

9. How will your life be affected? The renovation toll.

House renovations can require you to take a hands-on approach to organise everything - project managing the process from permits to subcontractors can be challenging but rewarding.

There is also a disruption involved with various subcontractors entering your house to undertake the work. Some aspects of the home may not be functional for a period of time. Should you choose to renovate and still live in the home, this can be quite an emotional toll to prepare for and very stressful for you and your family.

Rebuilding can prove more straightforward as builders take control of the site and don't have to plan around your presence which can save time.

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Key takeaways when choosing between KDR and renovation

  • Check with the local council before taking any action.
  • Check with a local real estate agent or market value tool to assess market conditions.
  • For a full home makeover, knockdown rebuilds can often prove less expensive than renovating.
  • Consider the age of your current home, as this can affect whether you can rebuild or not.
  • The rebuilding process tends to be more structured than renovating.
  • Consider whether renovating will improve your home's liveability.
  • Consider the emotional and/or physical toll that embarking on a renovation can have.
  • Rebuilding may take longer depending on the project.

The verdict: Should you knock down and rebuild or renovate?

Whichever option you choose, it's important not to overcapitalise. Overcapitalising is when the costs of your rebuild or renovation outweigh the market value it adds to your home.

If you're located in a sought-after suburb, location alone may minimise your risk of overcapitalising. However, if your suburb is underperforming, a smaller-scale renovation might suit you better.

The decision lies in your hands. Now you're equipped with some background knowledge, you'll need to work the details out according to your family's needs, desires and budget. So what's it going to be? A rebuild or renovation? The choice is really yours, but for more insight into the process of a knockdown and rebuild, read how Plantation Homes can guide you through every step of the way.