Home » Blog » Should You Renovate or Rebuild: Which Should You Choose

Is it cheaper to knock down and rebuild or renovate? The cost of rebuilding a house can be more predictable than the cost to remodel house; it all depends on the project’s size and your expectations. Planning is key to maximise your budget and avoid hidden costs. 

We discuss whether the cost of renovating, whether it’s cheaper to renovate or rebuild, and what should factor into your final decision.

The Costs of Renovating

While many people opt to renovate home the costs need to be understood before you decide – is it better to renovate or build? The average cost to rebuild a house Australia, is $350,000, which doesn’t typically factor in the risk of hidden costs of knock down rebuilds.

How much to renovate a home?

The average cost of a complete renovation is around $300,000. The renovation cost per m2 Sydney is around $3,000, so you can use that figure to answer should I renovate or rebuild. That cost also depends on the luxury fixtures and fittings you choose.

While the rebuild sounds more expensive when you consider the task involved in rebuilding and the materials involved, it’s giving you more bang for your buck.

How to Decide between Renovating or Rebuilding a Home?


The total cost of either will largely depend on the work you are considering.

If you plan to tear down a single-storey, two-bedroom, one-bathroom to rebuild a two-storey with two bathrooms and four bedrooms, that is a higher cost than simply renovating the existing home. However, if you’re looking to rebuild bigger, the existing property is obviously not fit for your purposes any longer. In that situation, you have to compare the cost of rebuilding in situ to the cost of buying something similar elsewhere.


The age of your property has to be a factor. Modern construction isn’t what it was when hardwood was standard and homes had inbuilt decorative touches. If you’re looking to hold onto those or recreate them in a new build, you may be better off simply renovating the home.

If your home is old and unsightly, it’s a prime candidate for a knockdown rebuild, especially if all the value is in the land.


Never underestimate the market.

You don’t want to overcapitalise, so speak to an expert estate agent in the area before you make a final decision. A budget renovation might be a better option in certain markets. A rebuild might be the ideal choice for locations where land is scarce or if your land is in a sought-after location.

Council Planning Laws

There are restrictions when it comes to knocking down and rebuilding homes of a certain age, so you should look into council regulations and planning laws early in the process to find out what your options are. Additionally, the council must issue permits for any work to remove trees or vegetation from the block.

Block Condition

The condition of the block counts – if it’s sloping, it’s going to be a much bigger rebuild task compared to a flat block. There are other factors to consider with the block and those could play into whether you receive the necessary permits to carry out work. The best person to speak to about the block is an engineer, architect, or builder. They can advise you whether a rebuild is possible; otherwise, renovations may be your only choice.

Why Rebuild a Homes Might Not Be For You

Ultimately, rebuilding your home is probably a cheaper option if you’re looking at a like-for-like rebuild and it allows you to get everything you want. That being said, it’s time-consuming and stressful. Having a home rebuilt can take six months minimum, which increases the risk of costly delays and company collapses if you don’t do proper due diligence when hiring a builder. 

Homes to renovate are typically no longer fit for purpose for the homeowner.

Why a Renovation Might Not Be For You 

There’s a good chance renovating will be more expensive than rebuilding, but that isn’t always the case. The key is understanding the level of renovations required to get the home in the condition you’re aiming for. 

One of the biggest issues with renovations is having to move out and live elsewhere or live in a construction site for the foreseeable future. There are limits to renovations, especially when the budget comes into play. If you go too big with your renovations, you may make your home impossible to resell. You also have to say goodbye to any of the quirky features of the home or lose its character.


Whether you decide to renovate or rebuild, you will have to factor in a range of issues to determine which one is the right choice. Whether it’s a cost issue, or it’s down to local council regulations, planning permissions, or the state of the block – you don’t necessarily have to pack up and move if you can’t rebuild. Renovation is a great option that many people choose.

Frequently Asked Questions

Is it better to renovate or rebuild? 

The decision to renovate or rebuild depends on your goals for the construction work and what type of budget you have. The best way to make the decision is to have quotes from several companies and discuss your options with experts.

What is the most expensive thing when renovating a house? 

Kitchens, cabinetry in particular, are the most expensive renovation project.

What adds the most value when renovating a house? 

Kitchens and additional bathrooms provide the most bang for your buck in terms of adding resale value. In terms of ROI, HVAC and garden improvements are also popular.

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