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The cost to build townhouses and multi-unit buildings in Melbourne depends on numerous factors. These include the construction costs, home builders costs, the cost of land, and site costs. There are also lesser factors that affect prices, such as foundation type, insulation quality, and the size dimensions of your building. Overall, there is a wide range of costs; some homeowners might pay $300 per square foot. However, this price is only a starting point.
If you're looking to invest in a dual occupancy project and build multi-unit buildings in Melbourne, you can expect to pay anywhere between $350 and $850 per square foot.
In this article, we explore all the different factors that affect the final price for building two townhouses or multi-unit buildings in Melbourne. Also, we'll touch on the exact numbers and help you determine how much does it cost to invest in dual occupancy development in Melbourne.
What is a Townhouse?
A townhouse is a multi-story residence that is connected to one or more other units. You'll commonly see them along the roadways in dense suburban and metropolitan locations. Townhouses resemble regular detached homes but operate more like condominiums, or condos, in that they are all governed by the same entity.
What is a Multi-Unit Building?
Multi-unit buildings are buildings with more than one residential unit. Within the same building, many units can be stacked one on top of the other or side by side.
What is a Dual Occupancy Building?
Dual occupancy is a building with two flats or houses on one title. There are a variety of arrangements that can be used for dual occupancy buildings. This could be two side-by-side houses with street frontage that are connected. It could also be one house behind the other that includes driveway access on one side to access the property.
If you're interested in finding out the costs of building townhouses in Melbourne, it is essential to understand all the factors affecting development costs. The prices of building townhouses or multi-unit buildings depend on numerous considerations, and we will explore them in more detail later on.
First, let's find out why people choose to invest in dual occupancy buildings or multiple buildings at all.
Why Invest in Dual Occupancy Buildings in Melbourne?
There are numerous reasons for building multi-unit dwellings in Melbourne. Primarily, these projects remain cost-effective over time.
Also, there is a growing demand for dual occupancy dwellings. People want to live closer together and use their money on education, travel, and other expenses. This has created high demand for the small units since they cost less to run.
Dual occupancy buildings are also cost-effective.
To build two townhouses in Melbourne, you'll need to purchase land, and the cost of construction is divided into two or more units. At first glance, this may seem too costly for some investors, but it pays off significantly over time with the right strategy.
The cost to build two townhouses in Melbourne is typically less than half the cost of a stand-alone house.
In addition, you can rent out one unit and live in the other. This way, your living expenses are covered with only one unit, and when you pay off the building costs, you can even build wealth by renting.
Now, let's explore all the factors that affect the build cost and how much does it cost exactly to invest in multiple property development in Melbourne.
What is the Cost to Build 2 Townhouses, Melbourne, Australia?
In this section, we will look at all the factors that affect the cost to build two houses in Melbourne and provide you with a cost estimate for building dual occupancy housing.
The Cost of Construction
Typically, construction costs make up a significant cost for two townhouses in Melbourne. The cost to build a dual occupancy housing unit accounts for about the majority of the total cost.
In general, for a single-story building that uses basic materials for construction, the average price is $1000 per square meter. An upmarket luxury build could cost you up o $3000 per square meter for a double storey dwelling.
In a typical suburban area, a dual occupation building or two townhouse developments cost about $1350 per square meter, or $1700 with site costs. An average 3 bedroom townhouse will cost $250,000 upwards per unit.
The cost to build two townhouses in Melbourne varies and depends on multiple factors such as:
- type and quality of materials used;
- required design elements;
- the cost of labor in the area;
- development sites cost;
- the cost of land;
- other costs.
Type and Quality of Materials Used
Your building costs will increase if you decide to go for better-quality materials. For example, building two townhouses in Melbourne with essential build materials like brick and wood may cost you around $150 - $300 per square metre, whereas using costlier material could cost almost double. It is best to look for builders cost crunches online to see the cost breakdowns of different materials used for building townhouses.
Required Design Elements
Townhouse layouts are costlier to design if you want them to stand out. For instance, you may opt for more complex architecture with more expensive materials and design elements like high-end kitchens and bathrooms, fancy tiles, and other cost-intensive features.
The Cost of Labor
If you decide to hire a contractor for your project, it will add costs to your final price as the cost of labor can be pretty pricey. Normally, the cost to build a townhouse in Melbourne for a 100 square meter project could cost you about $25,000 -$50,000.
Development Site Cost
The cost of buying a development site for building two townhouses in Melbourne will affect building them. It is recommended to hire town planners prior to the purchase as they can advise buyers which developments are allowed.
You can save on costs by buying an existing house for redevelopment. For example, the price to purchase and redevelop an existing house in Melbourne is estimated at around $100 per square meter whereas the cost to build new townhouses is estimated at around $150 per square meter.
The Cost of Land
The cost of land is another major cost when building two dwellings. So how much does it cost to acquire land in Melbourne? The price of land fluctuates depending on many factors, mainly location and availability. The price ranges between $150,000 and $875,000.
Keep in mind you will be charged an extra cost if you plan to build a new house or multiple buildings in a more popular area with high demand for housing projects. However, if you go for less popular areas (for example flood-prone areas), you will pay less for the land
As with any construction project in Australia, you'll need to check local planning laws when buying land for two units and ensure appropriate planning permits.
Other Costs
In addition to construction costs and the cost of the land, you need to take into account several other factors that will affect the final price, such as:
- Land tax
- Town planning permit
- Goods and service tax
- Legal cost
- Site management
The Hidden Cost of Building a Duplex or Multiple Townhouses
When building a duplex, multiple townhouses, and multi-unit buildings, there are some hidden costs people tend to forget about, such as
- The cost of demolishing an existing house before building a new one.
- The cost of making infrastructure improvements. This may include upgrading public services like power, water supply, etc.
- The cost of property advertisements for selling or leasing out your properties.
Another important cost that is peculiar for this type of property only is the subdivision of a property.
Property Subdivision Cost
Subdivision of a property isn't straightforward and includes multiple costs such as consulting fees and town planners.
In order to subdivide a property, you need to pay an application fee and have it approved. After that, you will have to hire a surveyor who will cost you about $2,000 -$3,500. Then comes the cost of land division itself at approximately $5 per square meter followed by a cost of land survey (if the surveyor didn't do it).
How to Reduce Costs When Building Townhouses, Melbourne?
When it comes to the build price of two or more townhouses or multi-unit buildings, you should keep in mind that there are several ways you can reduce your construction cost.
First, you can choose to build townhouses instead of units. Townhouses are larger than units and cost less per square metre because the cost is divided between two properties.
You can also opt for modular construction instead of the traditional brick-by-brick building, which reduces cost. Modular home builders in Melbourne use prefabricated construction to keep costs low.
You can also save on the cost by building dual occupancy homes instead of two separate properties. Of course, this will depend on your requirements and living arrangements.
Finally, you can choose to build smaller dwellings that cost less than large properties.
Materials, Furnishings, and Appliances
You can also save a significant amount of money if you purchase all materials yourself. Materials manufacturers offer volume discounts when you buy in bulk, significantly reducing the final purchase price.
The cost of furnishing and appliances vary greatly depending on whether you purchase them one by one or in bulk. For example, suppose you need to buy kitchen cabinets and appliances for two townhouses. In that case, cost savings are maximized if you purchase these items simultaneously, which directly impacts the final purchase price.
How to Make Sure Your Townhouse or Duplex Development Project Pays Off?
If you're wondering whether your investment will pay off, contact a respected company in the construction industry. From cost estimation to cost control and even a feasibility report, they will take care of every aspect of the construction process from start to finish.
In addition, cost consultants can give you valuable advice on reducing costs when building multiple units and townhouses and ensure cost savings, which can be used to attract potential buyers.
If you want to sell your development as soon as possible and avoid huge losses, cost consultants will help you achieve the best price for your property by offering cost-effective building solutions.
With their assistance, you should easily overcome any difficulties during cost estimation and cost control.
How Can Eastbound Builders Help You?
Father-and-son team Jeff and Logan Wang are at the heart of Eastbound Builders. Founded in November 2014, Eastbound Builders now builds 55+ homes a year. The company has 11 full-time employees, 35+ proven and trusted subcontractor teams, a new showroom in Nunawading, and a display home in Mont Albert North under construction.
Eastbound Builders offer free consultation calls and help you get a cost estimate in less than a minute! Also, check out their cost calculator to help you estimate the precise cost of the property you are planning to build.
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