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Is a Knockdown Rebuild Worth It? Real Cost Breakdown for Melbourne Suburbs

If your home no longer suits your needs, but you love your location, a knockdown rebuild could be the right choice. Instead of renovating around old structures, many homeowners in Melbourne choose to knock down and rebuild from scratch. It gives them a fresh start without moving. But is it worth it? This guide answers that question with facts, real costs, and common concerns.

What Is a Knockdown Rebuild?

A knockdown rebuild means demolishing your existing home and building a new one in its place. It's popular in Melbourne's older suburbs where homes are outdated, small, or poorly designed. Instead of patching up an old structure, you get a brand-new home that suits your lifestyle and block.

You don’t need to leave the suburb you love. You stay close to work, schools, or family while upgrading your home completely. It’s a clean slate without the cost of buying new land.

Rebuild vs Renovate: Which One Makes More Sense?

Many families in Melbourne compare these two options:

Renovating means working around the existing structure. It often costs more than expected and can uncover hidden problems.

Rebuilding lets you start from scratch. You can design the layout, choose modern materials, and avoid surprises behind old walls.

Quick Comparison:

Cost control: Rebuilding is more predictable

Design freedom: You choose everything, from layout to finishes

Energy efficiency: New builds follow modern standards

Value: New homes usually have a higher resale value

If your home has structural issues or a poor layout, rebuilding is usually the better long-term option.

Real Cost Breakdown for a Knockdown Rebuild in Melbourne

1. Demolition Costs

Demolishing a house in Melbourne costs between $15,000 and $30,000.

Factors that affect this price:

Size of the home

Asbestos removal

Access to the site

Council permits

You’ll also need to disconnect water, gas, and electricity. This usually adds a few thousand dollars.

2. Design and Planning

Architectural design, site inspections, soil tests, and permits may cost around $10,000 to $20,000 depending on the builder.

Some builders include these in the overall package. Always check if it's part of the contract.

3. Construction Costs

This is the biggest part of your budget.

Single-storey home: $1,500 to $2,000 per square metre

Double-storey home: $2,000 to $3,000 per square metre

For a 25-square home, expect around $375,000 to $625,000 depending on finishes and custom features.

4. Additional Costs

These costs are often overlooked but should be included in your planning:

Temporary accommodation: $10,000 to $25,000 (if you move out for 6-12 months)

Landscaping and fencing: $10,000 to $20,000

Driveways and paving: $5,000 to $15,000

Site works (sloping block, drainage): $10,000+

5. Total Estimated Cost

For most knockdown rebuilds in Melbourne, the total cost ranges between $450,000 to $750,000+ depending on size, design, suburb, and builder quality.

When Is a Knockdown Rebuild Worth It?

It’s worth considering when:

Your home has structural issues or doesn't meet your needs

Renovation quotes are too high

You want more control over layout and energy efficiency

Your land value is strong, but the house is not

You plan to stay long-term and want a fresh start

Many families in Melbourne’s eastern suburbs choose to rebuild rather than renovate. They get a modern home in the same neighbourhood, often increasing property value.

Top Melbourne Suburbs Choosing Knockdown Rebuilds

Knockdown rebuilds are booming in:

Glen Waverley

Doncaster East

Bentleigh

Box Hill

Essendon

Camberwell

These areas have:

Older homes with outdated layouts

High land value

Good schools and amenities

Growing family demand

Rebuilding allows homeowners to upgrade without leaving a sought-after suburb.

Common Mistakes to Avoid

1. Underestimating Costs

Plan for unexpected costs like soil issues or permit delays. Add a 10% buffer to your budget.

2. Skipping Site Analysis

Always check soil condition, drainage, and access. Poor site prep can add thousands.

3. Not Reviewing the Fine Print

Read the builder's inclusions carefully. Some basic packages exclude flooring, driveways, or appliances.

4. Delaying Council Approvals

Every council has different rules. Get advice early and allow time for planning permits.

Rebuild vs Buying a New Home: Which Is Smarter?

Buying a new house may seem easier, but:

You pay stamp duty on land and house

You may have to move away from your current area

New estates often have smaller blocks

Rebuilding lets you stay in a familiar area, save on stamp duty (only on construction), and get exactly what you want.

For many, it’s the smarter investment.

Frequently Asked Questions

Q1. How long does a knockdown rebuild take?

Usually between 10 to 14 months including planning, demolition, and construction.

Q2. Do I need council approval?

Yes. You need a demolition permit and planning approval for the new build. Your builder can help with this process.

Q3. Can I live in the house during the process?

No. You must vacate the home during demolition and construction.

Q4. What block size is ideal?

Most suburban blocks are suitable. Even narrow or sloping blocks can be rebuilt with the right design.

Q5. Are knockdown rebuilds good for property value?

Yes. A modern home on a well-located block can boost your property’s value significantly.

Why Work With a Knockdown Rebuild Specialist?

Rebuilding isn’t just about construction. It’s about design, compliance, budget control, and managing timelines.

Specialist builders guide you through:

Site inspection and feasibility

Design that suits your block

Council permits and approvals

Transparent pricing

Construction from start to finish

They know the local councils, common problems, and how to avoid delays. You get peace of mind and a smoother process.

Final Thoughts: Is It Worth It?

A knockdown rebuild is worth it if you want a home that fits your family, adds value, and keeps you in your ideal location.

While the upfront cost is high, the long-term benefits often outweigh it. You get a tailored home, built to modern standards, in a suburb you already love.

If you’re still unsure, talk to a local builder for a free site inspection. They’ll help you weigh your options based on your block, budget, and goals.

Need help planning your knockdown rebuild in Melbourne? Contact Magic New Family Homes to discuss your site, design ideas, and cost estimate.

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Home & Land Packages vs. Buying Established Homes: What’s Best for Your Family?

When planning to buy a home, most families face one big choice. Do you build new with a home and land package, or buy an established home?

Each option has strengths. The better choice depends on your needs, budget, and long-term goals.

This guide breaks it down clearly so you can decide what’s right for your family.

What Is a Home and Land Package?

A home and land package is a deal where you buy land and build a new home in one process. Builders often partner with land developers to offer these packages. You choose a block, pick a design, and the builder does the rest.

This option is popular in growth areas around Melbourne. Many families choose it for better value, modern layouts, and fewer repairs.

What Is an Established Home?

An established home is a house that’s already built and owned. You buy it “as is” from a seller. These homes are usually in older suburbs with schools, transport, and shops nearby.

They may have charm or character you don’t find in new builds. But they can also come with wear and tear, and you can’t change the layout easily.

Price and Costs

Home and Land Packages: New builds often cost less upfront. Stamp duty is lower because you only pay it on the land, not the house. You also avoid big repair costs early on. New homes follow the latest building codes, so they’re more energy efficient.

Established Homes: The cost is higher, especially in Melbourne’s inner suburbs. You’ll pay full stamp duty on the house and land. Older homes may need repairs or upgrades.

If price matters most, a home and land package is usually the better value.

Customisation and Design

Home and Land Packages: You choose the design, layout, and finishes. Want an open kitchen? Need a playroom or study? You can plan it all before building starts. Most builders let you adjust designs to suit your family.

Established Homes: You get what’s there. You can renovate later, but it takes time and money. You may face limits due to council rules or old materials.

If you want a home that fits your lifestyle now and in future, building gives you more control.

Location and Lifestyle

Home and Land Packages: These are mostly in Melbourne’s outer suburbs and new estates. You may get more space, parks, and modern facilities. But some services, like public transport or schools, may take time to arrive.

Established Homes: These homes are in well-settled suburbs. You’ll find nearby shops, schools, and train lines. Commutes may be shorter.

If location and access to city services matter most, an established home may suit you better.

Maintenance and Upkeep

Home and Land Packages: Everything is brand new—roof, plumbing, appliances. You won’t face major issues for years. Most builders offer warranties that cover defects for a set time.

Established Homes: Older homes often have wear and tear. Roof leaks, faulty wiring, or aging pipes may show up soon after you move in. Even updates like insulation or heating can cost more than expected.

If you prefer fewer problems and peace of mind, a new build is safer.

Energy Efficiency and Technology

Home and Land Packages: New homes follow modern building standards. Most include energy-efficient lighting, solar options, better insulation, and water-saving features. This lowers bills and helps the environment.

Established Homes: Many older homes lack these updates. You may need to upgrade windows, heaters, or lights to lower costs and improve comfort.

If energy use matters, newer builds are usually better equipped.

Time to Move In

Home and Land Packages: There’s a wait. Building takes months. You’ll also need to get council approvals, finalise the contract, and manage timelines. If you're renting, you’ll need to plan for this extra time.

Established Homes: You can move in faster. Once the sale settles, the home is yours.

If speed is key, an established home is the quicker path.

Investment and Long-Term Value

Home and Land Packages: Properties in growth areas may rise in value over time. You start fresh with modern features that buyers will want in the future.

Established Homes: Homes in top suburbs may already hold strong value. But older homes may not appeal to every buyer unless updated.

Both can be good investments. It depends on the location and how long you plan to stay.

Financing and Loans

Home and Land Packages: These need two contracts—one for the land and one for construction. You’ll need a construction loan and may make progress payments during the build. This setup can be confusing if you're not familiar.

Established Homes: You take out a standard home loan. The process is quicker and simpler.

Speak with a mortgage broker or bank to know which suits your situation.

What’s Better for Your Family?

There’s no single right answer. It depends on what your family values most:

Choose a Home and Land Package if you want:

A new, modern home

More say in layout and design

Lower upkeep costs

Energy savings

Long-term value in growing areas

Choose an Established Home if you want:

A quicker move

A well-settled suburb

Mature gardens or character features

Shorter commutes

Less planning

Final Thoughts

This is a big decision. Buying a home shapes your family’s future. Think about your budget, how you live, and where you see yourselves in five years.

At Magic New Family Homes, we help Melbourne families build homes that work for real life. From choosing land to final handover, we make the process simple and clear.

We also know building isn’t for everyone. If you buy an existing home, plan for repairs, updates, and loan setup. Either way, doing the homework now avoids stress later.