Knockdown & Rebuild vs Renovation

Hi everyone,

My partner and I are considering knocking down our existing property versus renovating it. We're deliberating heavily and weighing out the pros and cons. Naturally, we want to do as much research can before making an informed decision.

As this is all new territory, I have heaps of questions and I'm looking for inputs. I hope that my questions and the answers provided will be useful to others in a similar boat.

To begin with, here is the background info.

• We really love our location.
• Our house is just about 10 years old - not that old in my books.
• It is a 3 bedroom townhouse on approximately a 420 sqm block of land.
• Ideally, we'd like to add 2 bedrooms downstairs with an ensuite each (space permitting. Otherwise, it will be a shared bathroom),
• a butler's pantry,
• 1 bedroom upstairs,
• separate the toilet from the existing bathroom upstairs,
• reduce the size of the existing master bedroom upstairs.
• Increase the existing ensuite and the walk-in wardrobe.
• Reorientate the house plan downstairs.

The house has had a few issues structurally - according to what I've been told. So the knockdown rebuild route, we think will help us address these. It's like a fresh start. Regardless of the route we take, both will cost. And off the bat, the cheapest route that will get us the things I listed above on this location will most certainly be the option we take.

Without knowing anything in terms of costs etc,

1. Do I speak with my local council first or the bank (finance entity)? Or someone else?
2. In speaking to the council, what am I after? (I'm extremely green).

I will start with these two questions first. Thank you in advance.

Assuming this is a free standing townhouse. We were in the same boat as you, we spoke to an architect about renovating our house. In the end the cost to renovate came close to the base price of a new build so we decided to just go knockdown and rebuild.

1. It would be good to work out a budget before talking the council. What we did was go to several builders and take down the base price of the design that we liked then add on the upgrades that we wanted. This way we calculated the total cost to build. Also factor in other costs involved with a KDR, demolition cost, electricity pit, etc. Knowing our budget made it easier to get the process started.

2. For KDR, builders usually order a Property Information report which contains details about the zones that your property is in, whether a planning permit is required, floodzones, BAL etc etc. Yes you can probably try and do this yourself but you are more likely to miss something so best to go with a builder and let them deal with the council.

Hi reaver, thank you for the reply. Really appreciate it.

Our townhouse is a freestanding townhouse.


The input about finding out our budget makes total sense. But I've got a couple of questions on that.

1. Did you pay for an/the architect for the consultation? I'm assuming that's what it's called.
2. With regards to costings from builders, did you approach them with a design that your architect drew up? Or was the design that you liked available on say a website?
As an example, say you liked a house design by Carlisle Home/Porter Davis. You basically showed that to the builders that you shortlisted? Was there any cost in this? Reason I ask, is because I wasn't sure if builders would entertain that without some cost upfront - similar to my assumption with architects etc. Please pardon my ignorance.

3. I note that you're in Victoria, would you be open in sharing the architects / designers/ builders that you've engaged ?


Thank you again for taking the time.

1. There was a fee payment structure for the whole project but he was kind enough to just charge us for a couple of hours work when we realized that there was no point in doing the renovation.

2. If you want a custom design then you would engage a small builder that does this. Smaller builders tend to charge higher fees which means higher total cost for the build. There are volume builders like Metricon, Porter Davis, Carlisle Homes, etc etc where they have fixed designs/floorplans to choose from. They do allow changes and upgrades to their standard offerings. These volume builders is the lower priced option because they have a fixed set of designs/floorplans to choose from.

3. I'm going with a volume builder primarily because of the cost and they have the floorplan that we want. If you are alright with volume builders go browse their websites, most of them have prices there. Some of the more populare ones are Metricon, Porter Davis, Carlisle Homes, Boutique, Arden, Henley.

You can get a quote from any of the volume builders, they won't charge you for it.

Got it. Thank you for sharing.

I will check out the volume builders you've listed before looking up for smaller builders. Our block is trapezium in shape. I just think that we will need to build smartly to maximise and get what we want.

With that thinking, I think that the options provided by volume builders may not meet that. But I will take a look.

Thank you again.

Similar here. We started off wanting to extend / renovate as we quite liked the house. It ended up like a jigsaw puzzle trying to fit in what we wanted within existing constraints, and we paid several thousand for designs. Each option was a compromise in some way

In the end we decided to knockdown / rebuild - didn't cost much more, and we we are getting everything we want.

I found volume builders differ in their approach - some of the larger ones are take or leave it with their designs, whereas others (generally the smaller ones) will customize quite heavily to your requirements

Sell the current home. Use the equity to buy into something you like in the area you like. In these economic times you don't need all the hassle of building into a declining market.

Sell and then buy in a declining market? Might work if you sell now and buy at the bottom of the market next year. Huge risk though at calling the bottom.

I'd definitely think about selling your current house and buying another, larger house.

It's one thing to knock down an old weatherboard house, which may only have a valuation of $60k, but a 10-year old 3 bedroom townhouse? That's probably around $300k of house there that you're going to raze to the ground and not see one cent of ever again.

So I'd start off doing the maths. Find out what your current home is worth, and what an existing 5-6 bedroom in your area will cost you. If the difference in cost is significantly less that the cost to build a new house, then sell and move.

For a half decent build of a new 5-6 bedroom house, you're probably looking at around $500k. So for example, if your current house is worth $1m, and a larger house is $1.4m, you'll save yourself $100k, at least 12 months of planning and build time, and the hassle of moving in and out of your home into temporary accommodation.

Also check with your council re: maximum land coverage. You may not be able to extend your current house’s footprint.
There are 2-3 councils in Victoria that the town planning permit lasts forever and they continue to determine what’s permitted based on the original block.
If you can buy a bigger block with the same $ as to build and end up in the same debt, go for it. Land will appreciate more over time.

Hi everyone, thank you for the inputs. All certainly valid. For some, we’ve thought about it prior and are still thinking it through/working it through.

Will provide updates when I have some.

Agree with doing the maths. Our preference was not to go through the stress of knocking down and building, and there was nothing majorly wrong with the old house, but we spent ages househunting, and would have to had to spend a lot more to buy what we wanted. The was also the matter of over $100k in stamp duty

Thanks brokenstick. Will do. I think we are in a similar boat - i.e. spent ages house hunting, and from what we've gleaned, it would cost us more to buy what we wanted, where we wanted. However, our foundations on the current property are suspect so that's another incentive to move/KDR and perhaps not so much reno - if it's doesn't solve the issues.

But as it is early days, we are still researching.

I’m not sure if your finances allow but gave you considers buying else where and keeping your current property as an investment and renting it out?

Being a townhouse do you have any restrictions on it needing to lol the same/similar as others nearby?
What is the current floor space ratio for your block?

Hi, I am in the same situation, just want to know have u decided to build or just sell off and move?

Hello! We are still researching but leaning towards a KDR.

A sell and move may not be financially feasible. On top of that none of the floor plans available appeal to us.

We’ve since spoken to two renovation/ extension companies. We are also currently speaking with a KDR company. So will see what happens. Just trying to get more info on numbers etc.

So far, KDR seems to be able to give us what we want - as a whole (locale, size etc) - within our estimated range. But again we need to work out what those final numbers actually are.

We went through the KDR process over 2 years a go and ended up getting exactly what we wanted where we wanted.
There are challenges along the way such as coordinating everything in the right order and timing (abolishment of services, electricity pit, signing rental lease, timing of demolition etc) and engaging the right builder.
What may work against you (depending on where you are located) is your block size as there are council & resicode requirements surrounding building size on block size, set backs, overshadowing etc and you will need to try and get your site costs estimated by the builder as these can be a nasty shock with a KDR.

I am tossing between renovate or knock down rebuild or buy another better property.

Just got a kitchen guy came over today to give a quote of renovate the kitchen, including structure change may cost 100,000. My house is 20 years old, but build on cheap, used to be a rental, would be great to renovate all over but will cost too much and the floor plan not the best.

Would love to do knock down rebuild, but the common driveway is too narrow, don't know how they going to knock down the house, plus will cause lot of disruption to the neighbors. Our house is a freestanding town house with a very wide frontage, which I love.

Also my land is retangular shape, so have to use custom builder.

Let us know how u going with your decision.

Thank you for all the sharing. My current discoveries/learnings so far.

• For what we are hoping to build, we are looking at approximately a 40/45 sqm home.
• This is roughly double what we currently have.
• From what we've done so far, the cost of KDR build seems to be hovering between high 800k - 9xx.
• We also had a brief chat with a company about extending. Rough estimation costs for an additional 3 bedrooms change to kitchen & living layout, additional wet areas came to about 550-600k.
• But again with the extension, it will be like an add on and may not be maximising the wedge-shaped block.

I'll revert back when I've got more to share. It's a time consuming but interesting and eye-opening exercise.