The saying location, location, location! continues to be a driving force when it comes to property and real estate. Many homeowners in Brisbane are in need of a modernised home or extensive renovations but are unwilling to move from their area. Other buyers choose to purchase an old building in a prime location. In either scenario, there is an old house in the way of having a new home in the perfect spot. The best solution is often to knock down and rebuild your home.
“With plenty of older properties located throughout Brisbane that are situated in prime locations, the decision to demolish and rebuild has become an increasingly popular trend in recent years.”
Table of Contents
What is a knock down rebuild?
A knock down rebuild is exactly how it sounds. The existing house is demolished entirely, leaving your empty plot as a blank canvas. Then construction starts; work gets underway to bring your new home or investment property to life.
The pros and cons
- ✅Selling and buying costs– if you demolish your existing home there is no cost to sell i.e. real estate fees and no cost to buy stamp duty etc
- ✅Blank canvas for your design– with any new home build you will have the opportunity to bring your ideas to life
- ✅Increase property value– with record property growth in recent times, many property owners are seeing a higher increase in value in comparision to the cost of build (instant equity)
- ✅Stay in the neighbourhood you love – research shows that most people will sell and buy within 5km of where they are currently living. This is becasue they are used to the area, know their local resturants and have developed friendships in the area.
- ⛔️Requires planning and approvals– if you were to renovate your kitchen or bathroom in an existing home there will be no cost for planning or approval
- ⛔️Heritage sites restricted– Brisbane city council has a rule against demolishing homes there are pre 1946 its impotant to determin if your home can actually be demolished
- ⛔️Dificult to estimate fees before demolision– there are many upfront fees payable before you can fully understand the total cost of your project, unforutunality not all these fees apparent until you are in the midtst of the project
- ⛔️ Additinal costs If you demolish within 12 months of purchasing there will be no owner occupied concesion on Stamp duty (bonus calculation below)
Marketing vs Reality
You might have started to consider a knock down rebuild after seeing it advertised as an easy way to build a new home. The reality is that a knock down rebuild is quite a complicated process, requiring more planning and approvals than a regular build. So while builders may make it seem straight forward that is often due to most of the confusing pre-build planning falling on your shoulders, not theirs.
Most of the time the pre-construction process outlined by builders is a simplified one. Often only skimming over or avoiding entirely any mention of what is required of you.
Why not renovate?
Many owners choose to renovate their homes. This is a perfectly viable option, so why would you choose to knock down the current building and start again?
In Angela and George’s case, not all old houses have period features, timeless character or unique aesthetics. When a house has no cosmetic appeal to you as the owner — or if the residence is simply rundown — then it may be better, in the long run, to start from scratch. In fact, this option is generally cheaper per square metre than renovating.
Depending on the age and condition of the property, you may find yourself having to do continuous renovations in drips and drabs. If the costs and time required to maintain an ageing home exceed its worth; or its appeal, then a knock down rebuild is a perfect solution.
What does it cost to knock down and rebuild?
The demolition stage generally costs between $15,000–30,000, while construction ordinarily begins at $200,000. As it is with new builds, the price depends on the block itself, the company you work with, the design choices and chosen floor plan.
You may also need to be aware of hidden fees. For example, demolition, planning and building approvals from the council and certified authorities can cost you thousands. Disconnecting utilities can also attract charges.
Regardless, a knock down rebuild is far more affordable than purchasing new land, because there is no stamp duty. For those owners who are already living on the site, this is the first avenue for saving money if you desire a home makeover or need to bring your home up to standard.
How long does it take knock down and rebuild?
A complete knock down rebuild will take, at minimum, 8-12 months. Of course, if you have built a home before or know somebody who has, you will know that these are optimistic estimates and the real timeframe is often extended.
Just as if you were building a new house, you will need to factor in potential delays. Even if your builders are exceptionally organised, any number of events (from poor weather to supply shortages) can slow a project down. It’s a good idea to have a safe buffer in mind when planning your accommodation while the project is underway. Ensure you have the flexibility for moving in and out of your property.
Not sure if a knock down rebuild is right for you? Why not ask an expert!
Contact Buildi for a free consultation and friendly chat.
Before you choose a builder
Some builders will take on the project from start to finish, making your life a little “easier”. This is not always the case, we’ve found through our experience that some builders tend to add a margin for managing the demolition.
On a $25,000 demolition, a 25% margin would be ~$6,250. It’s important you understand how your builder will charge you and make sure you’ve completed a cost-benefit analysis before putting down a deposit.
At Buildi, we help you find the right builder, save time, reduce stress and stay on budget.
How We Can Help You
Building a home can be a daunting process. At Buildi, we work with you throughout the entire build process to avoid any pitfalls and make sure your house build stays on time and on budget by following these simple steps…
- Free Consultation – We will sit with you to understand what you are looking to accomplish.
- Due Diligence – We work with you to ensure you’re buying the right block of land at the right price without hidden problems.
- Builders tender – We will take your requirements out to the market of builders and they will bid to win your business.
- Present solutions – We will compile the top 3 options and present you with a comprehensive proposal on builders’ strengths & weaknesses along with prices and specifications.
- Contract Signing – We will work with you and your selected builder to ensure there is full transparency in what you are entering into.
- Building your home – We work closely with the builder, to ensure all service levels are met and your project is on schedule,
We help find you the right builder for your home build. Contact us today!
Making way for construction
Organise the demolition
One or two builders may offer to take on every step of a knock down rebuild, including demo. Most of the time, however, you will either ask for a recommendation or find one yourself.
“You will need to arrange a third party to come in and demolish your home. Once the existing home is completely removed, we can start our building process.”Coral homes
Plantation homes: below is an extract from a plantation homes contract, take a close look at all the items that are the owners responsibility under house demolition, this is a very easy way to get caught out which will end up costing you thousands more on your project.
If you are in this situation, ensure your chosen contractors are accredited for demolition and asbestos removal if any is present in the existing build.
A demolition contractor may also take on some of the below steps. We recommend having a discussion with your chosen builder and contractors to establish responsibilities and expectations. Knowing “who” is responsible for “what” will help to prevent any delays.
Obtain all necessary permits
You will need a number of permits and approvals in order to conduct a knock down rebuild, such as a demolition permit and building approval. Most demolition projects will need public asset protection as well as a temporary fence. There may also be additional pieces required depending on the location, such as traffic permits and permissions to remove trees. Keep in mind that these applications will often incur additional costs.
Check requirements with your local council. There are usually specific pages and fact sheets regarding demolishing and rebuilds, such as this one on the Brisbane City Council’s website. Your building brokers will have the experience to help you with these steps, so don’t feel as though you need to struggle with it on your own.
Builders vary in their services, and some will discuss your plans with the council on your behalf. We have however found that in many cases builders use this as a carrot to entice people into signing a contract. There is a requirement from building certifiers that you need to choose your builder before the project can be approved, this gives the builder ammunition to push clients into selecting them for the project.
Soil Tests and Reports
Before the demolition, it is likely that your chosen builder will want you to pay a deposit. This deposit is usually to get the ball rolling on your plans and complete reports. One of these reports being your soil test. The issue here is that soil tests cannot be done until after the demolition. This is due to the borehole for these tests will need to be where the old house sat.
This leaves you with 2 options. Either wait until after the demolition to pay a deposit to a builder or run the risk of an unexpected price hike when the builders assess your soil.
Heritage sites and approvals
Heritage overlays and restrictions may apply to your property. If your home is on a heritage register, it is unlikely that you will be able to go ahead with demolition. In other cases, renovations may be permitted with strict limitations (the facade might have to remain, for instance).
There are heritage registers in each state and most councils will identify heritage-listed properties on their Local Environmental Plan. In some instances, whole streetscapes fall under protection, in other cases you may only need to retain a heritage facade, a front fence or even a particular tree.Domain
Trees, vegetation and habitats
There are a number of planning controls and council regulations when it comes to cutting down trees and removing vegetation. If there is a heritage tree or regional ecosystem present on your private property, then you will need to obtain permission before removal. Again, this is entirely dependent on your specific council, so be sure to contact your local team for vegetation maps and applications.
Your property may have protected vegetation if it:
Is located near or in the Brisbane River or a waterway corridorBrisbane City Council
Is located in a bushland area or rural area
contains large significant trees even in an urban area
Has heritage values.
To find out if your property has protected vegetation you can request a map and report online or contact Council.
Either you or your demolition team will need to arrange disconnection of power and gas. Be aware that some energy companies will only speak with the homeowner or account holder. Don’t forget about any other services, such as telephone, internet and cable. Once confirmed, allow roughly 4-6 weeks for your utilities to be disconnected and companies can remove their infrastructure if required.
A plumber is also required to switch off the water and sewerage. This does not take as long and is usually performed a day (or even several hours!) before demolition.
Once everything is organised and ready to go, demolition will only take 3-5 days. During this process, your demolition team will need to remove building waste and any unwanted vegetation. As a price-saving tip, some companies will salvage and recycle the waste for you.
Prior to construction, your builder will organise a soil test and ensure everything is ready to go for your new home.
Knock down rebuild case study
Jack and Amy were facing difficulty finding an established inner-city property with all the conveniences they needed. They ultimately decided to change strategies.
Opting now for a knock down rebuild, loving the idea they could build a brand new house that suited them in an area they desired.
Due Dilligence Reports
Through many months of research, we helped Jack and Amy find the right house to knock down and rebuild. Along the way, we complete countless due diligence reports in order to fully understand the requirements and cautions involved with each block.
We completed a cost breakdown for Jack and Amy so that they knew the costs heading into the project
Cost of removal: $25,000
Additional cost for Stamp Duty: $7,175
Site survey: $2500
Soil test: $600
Total cost: $35,275
Jack and Amy settled on a 600m2 block at $570,000 with the additional costs above making it $605,275 for an inner-city location. This was great value for them and they decided to go ahead with the knock down rebuild.
We connected them with a builder and plans were drawn up. The problem was that once the plans were ready with the builder they couldn’t submit for approval unless the existing house was removed, this meant that the owners had to organise a pre-payment to cover the cost of demolition which was ~$25,000.
HOT TIP: In most cases, banks will not fund the cost of demolitions. Fixed price building contracts can only be finalised after demolition. Only then will banks consider your application.
Stamp Duty savings
If you’re planning a knock down rebuild take into account the potential savings you can make on stamp duty. If you have lived in the home for 12 months. Heres 2 different stamp duty calculations we did for a client.
The first is what they would pay if they were to immediately knock the home down.
Here’s what the stamp duty would be if you lived in the home for 12 months before knocking it down.
As you can see if you plan to live in the house for 12 months before you can save thousands of dollars. Here $7,175 was saved.