Are you thinking about building a new home? With so many options available in Australia, the decision can feel overwhelming. For many potential home builders, choosing a townhouse is an excellent option.
Townhouses allow you to build a home in convenient locations that offer great amenities. If you decide to build a townhouse with Sienna Homes, you won’t have to worry about price changes or hidden costs, as our pricing is fixed once you sign your contract.
Read on as we guide you through the common factors that can influence construction costs, provide handy budgeting tips, and explain why selecting a townhouse built by Sienna ensures you won’t have to deal with rising prices that may affect other types of homes.
What Is a Townhouse?
A townhouse is a type of home that typically shares common walls with neighbouring homes and often consists of multiple stories to maximise space. Since townhouses are designed and constructed together, they can reduce some construction costs. Additionally, due to economies of scale, and onsite efficiency, they can be more affordable than other housing types.
- More about ‘What is a Townhouse?’
Average Cost to Build a Townhouse in Australia
Based on current national averages, the cost of constructing a townhouse in Australia ranges from $230,000 for a two-bedroom, single-storey residence to $380,000 for a four-bedroom, double-storey home with a garage.
This calculates an estimated cost of $2,600-$2,800 per square meter, depending on the size, layout, and finishes of the townhouse.
Building a home in Australia involves navigating an unstable cost structure due to high inflation and increased material and labour costs. Several factors can influence your overall expenses, including the quality of finishes, the number of bedrooms, the number of stories, and the location of your site.
You also need to consider the price of purchasing the land, which varies depending on location and is separate from your build price.
Metropolitan Melbourne has a higher cost than suburban areas and regional Victoria.
A Two-Bedroom Townhouse
We can estimate that the construction cost for a standard two-bedroom, single-level townhouse is $230,000 – $250,000, based on national averages.
This price can vary depending on the overall size of the home and facade treatment, as well as any upgrades you choose.
A Three-Bedroom Townhouse
The cost to build a single-level, three-bedroom townhouse is estimated at $270,000 – $290,000.
The cost to build a double-storey, three-bedroom townhouse with a garage would be between $330,000 – $370,000.
While it might seem counterintuitive – as your townhouse size increases – the average cost per square meter can actually level off.
A Four-Bedroom Townhouse
When considering the larger end of the building spectrum, a four-bedroom, double-storey townhouse with a double garage is estimated to cost between $350,000 and $380,000.
While some construction costs may be obvious, it’s important to remember that there are often overlooked expenses associated with preparing your site, such as soil tests, earth moving, and connecting utilities. Additionally, there are costs for permits and approvals from your local council.
When you choose to build a Sienna home, you can have peace of mind knowing that the quoted price is a complete turnkey price, which includes all of these costs.
Factors That Influence Townhouse Construction Costs
1 Location and Land cost
Location, location, location! It’s hard to write an article on property and construction without writing those words. Still, location is one of the most critical elements in determining the cost of building your townhouse. Property in desirable locations close to transport links, infrastructure, and highly prized places like good schools and green spaces come with a premium price tag, adding to the overall cost of building a townhouse. It’s also worth keeping in mind that the location will impact the price if it becomes difficult to secure trades and materials – in more remote, regional areas, getting supplies and labour to site can cost more.
2. Home Size & Number of Levels
Australia has a love affair with big homes; according to a recent CommSec Home Size Trends Report, we are ranked the highest in the world for average new home size. Our preference for wide open spaces means that while our homes have gotten bigger, so have the bills we need to pay to build them. It goes without saying that a bigger home needs more land to build on, more materials to construct the home, and more time to complete; for example, adding another storey to your home will also increase the overall cost due to the additional structural requirements needed to construct multiple levels. That’s why choosing an efficiently designed townhouse is a great alternative and can be more affordable.
3. Quality of Materials & Finishes
The word ‘dream home’ can conjure up many images in the minds of prospective homebuilders. Yet, throughout the process, it’s essential to keep in mind what’s included in your finished home, and how top-of-the-range finishes can affect the overall cost of your project. Stone benchtops, wooden flooring, servery windows and high-end appliances all come at a premium cost. Choosing a home that comes with plenty of inclusions as standard is a great way to make sure you’re getting the most for your budget. With the option to upgrade also available, you can tailor the specifications within your home to balance the finishes you want with the spend you have.
4. Site Conditions & Preparation
In an ideal world, every piece of land would be completely flat, with perfect soil and all utilities already connected. However, one of the first lessons learned, especially when budgeting for construction, is that there are always unexpected costs. The quality of the soil on your site can significantly influence the overall cost of your project. Additionally, sloping sites can increase construction expenses, and environmental factors such as flood risk and the Bushfire Attack Level (BAL) rating must be evaluated before you can begin your build.
5. Council Regulations & Permits
Building a house of any kind requires obtaining the necessary permits and approvals from your local council. Your new home must comply with zoning laws and secure the relevant planning permits to ensure that it is fully compliant and ready for you to move in.
6. Design & Planning Fees
Choosing the design of your home can have a substantial overall impact on the cost. An architecturally designed home will come with a steep fee for design. If you choose a Sienna home, our expertly designed homes are a complete turnkey package, meaning they are stunning to live in with wide open spaces and ample natural light, but will not cost as much as a home custom-designed from scratch.
7. External Costs
Once your home is built, there are additional finishing touches needed to complete your dream. Landscaping and creating your ideal garden will incur its own costs, especially if you decide to include energy-efficient upgrades like solar panels and water tanks.
Other Hidden Costs to Watch Out For
Getting your site ready for construction can vary based on the layout of your land. Key steps include conducting soil tests, earth moving, and installing adequate drainage.
If you are building in a new development, you may encounter developer contributions and infrastructure levies. These fees help fund the roads and amenities in new suburbs.
The good news is that when you buy a townhouse, you’ll have a fixed contract so you’ll know exactly how much your home will cost you to build – and in many new builds, any overspends are the responsibility of the builders, not you.
Ways to Reduce Townhouse Construction Costs
Choosing the right builder is the smartest and most effective way to reduce costs. Choosing to build with Sienna Homes means your costs are fixed due to our fixed-price contract, so there will be no surprises and no hidden fees cropping up later in construction.
The alternative contract type is a cost-plus contract whereby you reimburse the builder for all expenses, including labour, materials, equipment, and subcontractors, plus the additional amount for profit and any extra fees. These contracts make it difficult to estimate the overall costs of construction.
Future Trends in Townhouse Construction Costs
A recent report from Infrastructure Victoria has revealed that a growing number of Australians are considering a change in their living arrangements. Specifically, one-third of households were willing to trade their house in a new suburb for a three-bedroom townhouse or apartment closer to the city centre, provided it was more affordable.
The costs and factors we have highlighted so far are based purely on past and current pricing. There is almost no confirmed way to estimate prices in the coming years. The raw materials prices in Australia have fluctuated incredibly in the past 4 years alone. Extenuating factors like the COVID-19 pandemic and subsequent inflation have meant that construction costs have steadily increased over the past few years. In addition to this instability, recent changes in planning codes to ensure all homes in Victoria meet a 7-star energy rating will also affect townhouse pricing.
Alternatives to Custom Building a Townhouse
The most effective way to secure the pricing of your townhouse is to build sooner rather than later. Better yet, explore our Townhouses For Sale page and find your ideal townhouse already designed and move-in ready.
Buying a townhouse from Sienna Homes means avoiding the hassle and uncertainty of building from scratch. Instead of navigating the complexities of custom building a home, our fixed pricing structure and turn key solution means the only thing you need to do is pick your interior colour scheme and move in.
Check out all the available homes in great locations close to schools, transport links and great amenities and find your dream home.
FAQs
How long does it usually take to build a townhouse?
The average timeframe to build a townhouse in Australia is 6 to 12 months, depending on factors like the size of the home, site conditions, weather delays, and material availability. Building from scratch can face unpredictable delays, including council approvals, construction timelines, and supply chain disruptions. However, if you purchase a townhouse off the plan, the developer provides a set construction timeline, giving you a clearer move-in date with fewer uncertainties.
How to make sure you have the right budget to start a project?
If the old adage is “measure twice, cut one”, then when it comes to budgeting, the phrase should be “for-warned is for-armed.” Before you start a construction project, you should look at how much it costs to build a townhome with various different companies. Get information on what’s included, the process, the locations and the layout of a home. You’ll then be able to see the best way to get the home you want with the budget you have.
Why building a townhouse might be the right option?
Townhouses hold many benefits as a property type; their shared walls and the fact they are built as part of a collection of homes means much less upkeep than free-standing homes and no strata fees compared to most apartment buildings with many amenities.
When it comes to constructing townhouses, the increased purchasing power and economies of scale in building multiple homes at once is how townhouses can have stable average prices and faster build times.
