Knockdown and Rebuild in Melbourne

The decision to demolish is never an easy one, and various factors can influence your decision on when to knock down your old house. Still, there are many situations where it’s ultimately more feasible and financially beneficial.

When approaching any property decisions, the first step is proper consideration and research towards the value of your options. When comparing a knockdown rebuild with renovation, you need to consider the extent of renovations and expenses related to your goals.

• Are the renovations going to cover a large portion of the property?
• What is the value of your property in the local property market?
• Do you love the house, or just tolerate it?

Many older homes can be subject to damage and degradation, such as termite damage, structural faults, mould and foundational damage. Renovation costs can also climb due to unexpected complications, issues sourcing materials for house modernisation and complicated renovation processes.

By performing a complete demolishment, you can quickly address these issues and reduce hefty costs dealing with these issues around your house. Most look at a knock-down rebuild to increase the value of their home and property. This can be one of the most cost effective investments you make on your property.

A renovation will typically cost less than a knockdown rebuild. However, the initial cost is not the only factor when reviewing the financial benefits between these two options. What’s most important is infact the total value gained for the cost.

To gauge this, you’ll first want to figure out the numbers you will be working with for the desired renovations through research and professional quotes. By hiring a professional surveyor or builder, you can estimate these costs quickly. It’s advisable to add on 15 to 20% budget to any renovation quote as a buffer for unforeseen challenges prior to the final project sign off.

Renovations can get expensive, with hired contractors potentially encountering many issues, so you need to prepare your budget accordingly. If we look at simple cosmetic renovations for a single room, investments could range (depending on a multitude of factors) between:

• $25,000 – $65,000 for kitchen renovations
• $15,000 – $50,000 for bathroom renovations
• $5,000 – $20,000 for garden deck constructions and installations
• $5,000 – $35,000 for bedroom renovations

Knockdown rebuilds can vary even more, depending on the size and scope of the project. For an average piece of land in Melbourne; a basic single-story project house built after a knockdown could set you back as little as $250,000, whilst an architecturally designed custom home built after a knockdown could be as high as $2,421,900.

Like any investment, you’ll need to calculate the return on investment (ROI) offered by renovations, versus a knockdown rebuild. An excellent way to get the figures required is to contact some local real estate agents and find out the ceiling value for local properties, compared to the ceiling value for your property after any work is completed.

Generally, a knockdown rebuild will result in a higher ROI due to the demolition process removing any hidden issues you might find during renovation. A rebuild also provides the freedom to create from scratch, rather than having to carefully maintain specific areas of the original home. The ROI for a knockdown rebuild is also generally higher as newer homes command a higher market value due to modern styling, energy efficiency and a “clean bill of health”. Knockdown rebuilds allow you a clean slate to work from and not just in terms of design. By establishing a new property, you also start from step one on repairs and maintenance, reducing the likelihood of significant issues in the next 15 to 20 years. The only downside of a knock down rebuild is the higher cost entry point versus a renovation.

Renovations are usually picked for smaller-scale jobs, for situations where budget won’t allow for the ideal knockdown rebuild scenario, or where owners have an emotional attachment to the property.

In terms of space maximisation, energy-efficient solutions, and increased property valuation, a knockdown rebuild would usually come out on top.

Once you’ve committed to a knockdown rebuild and have undergone the demolishing process, a significant constraint on your rebuild can be the land itself. Different property land types such as sloping and flat can influence the complexity of your build, with sloping ground increasing the build considerations required.

Ultimately regardless of land type, the goal of your knockdown rebuild will be to maximise the viability of your property; this means emphasising house space through either expansion, multi-level development, subdivision or seamless architectural design.

The housing market has a hefty paper trail with council approval, so you’ll have to start dotting your i’s and crossing your t’s before anyone knocks down a house. These permits can include the following depending on your region:

• Demolition permit
• Building permit and building approval
• Asset protection permit
• Town planning permit and planning approval
• Any other permits advised by your local council for a knockdown rebuild

Ultimately, this process will come down to careful consultation and research into local regulations and legalities. Consideration will need to be given to heritage overlays and listing. Houses falling within these categories are houses registered as heritage properties. They will have a lot more red tape to deal with to ensure that any planned changes don’t interfere with the house’s character. Once you have all of the paperwork complete, the land surveyed, quotes lined up, and the financials sorted, it’s a matter of preparing for the demolition.

The demolition itself will require a permit, typically provided by your registered building surveyor. Conditional to the fencing of your property, disconnection of all utilities (gas, electrical, internet, water), treatment of the property for pests, removal of hazardous materials and salvage of reusable materials might need to happen two to three weeks before application. The overall application process can take anywhere from five to 30 days, and the demolition itself can generally take up to two weeks.

We expand on this whole process, minus the demolition, in our article: The 10 Stages of Building a Home. Simplified however, the steps for a knockdown rebuild come down to:

1. Planning and Research
   In this step, you will get professional assessments, inquire into permits and local regulations required, begin the appropriate processes, assess hazardous materials such as asbestos, and ensure your finances are in order. You will also need to consult your local real estate agent to determine the ROI of your build.
2. Design
   This is the fun part! In this step, you’ll consult Forme Homes about the overall design process and determine what it is that you want from your brand new home.
3. Final Assessment
   This is where you’ll begin to finish off any required applications and get extensive inspections completed for soil testing, contour site surveyance and an overall compliance check to ensure that your build complies with local council regulations.
4. Demolition
   Once all the permits and applications have been acquired and approved, the process of demolition kicks off. Post mechanical demolition and subsequent cleanup, you’ll be provided with a demolition clearance certificate, indicating that construction can now commence!
5. Construction
   From the rubble of your old house your new home will be born, with all the bells and whistles to give you a leg up in your local property market.

A knockdown rebuild offers you all levels of freedom to escape problem-riddled properties with weakened market value, or to build the home of your dreams in the location you love. By knocking down a preexisting build, you could also branch off into a subdivision of land and develop investment properties, maximising your rental capacity, with the added security of a brand new home.

Purchasing your first home can be an exciting process, but nothing quite compares to having a home custom-tailored to your needs and wishes.