By John Wrighty

A very common question asked by a new home buyer is “What will the building costs be per square metre?”

They are after a simple answer, sometimes known as a ‘ball park’ figure, even though there are quite complex calculations involved.

Naturally since one of the common ways to judge the size of a house is by the area it covers, it follows that new home buyers would ask what are the building costs per square metre.

Even though most building consultants and specialists prefer not to use the cost per square metre equation as a yardstick, the reality is it is very common.

The popularity of the Square Metre Cost Formula means that new home designers work themselves into a frazzle trying to come up with new home designs which present the best possible value “per square metre.”

This has resulted in peoples’ living spaces being reduced to basic commodities, while increasing the tensions between competing building companies.

YouTube Preview Image

A lot of this competition means cheaper home prices, but also can lead to lower quality buildings and inclusions.

Building Costs per Square Metre, per Kilogram, or per Design feature?

Talking to a qualified and experienced consultant will make sure all the ramifications of just going for the cheaper price per metre are clear to the new home buyer.

It may be a cheap price per square reflects the fact that some of the basic inclusions have been left out; and a more expensive price per square metre might include all whitegoods for example.

It all hinges on what the outcome is that you are after.

What ARE the Building Costs Per Square Metre?

This question is best treated as a serious intention to find out accurate as possible pricing information with regard to how much a given house will cost.

Then they can understand how the various elements that make up a home affects the building costs per square metre.

This is better than reducing the whole question to a generalised standard cost of a bare bones house built to lock-up.

It is evident that house building costs are calculated by measuring the quantity and costs of the building materials used, plus the cost to assemble and install those materials, plus the costs to manage that process, plus the cost to obtain permits for that process, and finally to make money managing that process by using a simple calculation called the ‘margin’.

Sometimes margins are a percentage of the costs, sometimes they are a lump sum; but the idea behind operating a building business is to make money managing the building process.

So why Building Costs per Square Metre?

Even though it is well known within the building industry that costing per square metre is the fastest way to go broke, sales people do it, and builders follow to get the job.

Some of our more successful building companies do this; clearly they are not using building costs per square metre, as a rule of thumb, to calculate their selling prices.Having said that, if the square metre price is derived from sensible calculations, and then used as a ball park figure for the purpose of comparison between different designs for example, then there’s no harm done. Many successful building companies use square metre pricing in this way.Many successful home building firms use square metre pricing like this, and it is suitable if the square metre price has been derived from realistic calculations and then only used as a differentiation between various options.

If you have any doubts how much a about building costs per square meter you owe it to yourself and your family to contact someone like Joh Domingo at Building Buddy. He’ll save you a lot of heartache by showing you how to make clear decisions about building your new home.

About the Author: Joh loves everything about helping new home buyers get the best value for their money. If you want to find out more about

building costs per square meter

then Joh is your man.


Permanent Link: