So you’ve decided that your current home no longer suits your needs but you love the area you live in and don’t want to move away.

This leaves you with two options: you can knockdown-rebuild or you can extend. Your choice will naturally be determined by your particular circumstances. In this guide we examine initial considerations, the financial traps and benefits of each method, council approval and the specific issues involved in a demolishing a house.

When you’re deciding whether to knockdown/rebuild or extend, a set of essential issues must be addressed. Ask yourself the following crucial questions:

Is your existing home in a condition that is suitable for renovating?
Do you like the design of your existing home?
If you renovate, can you find materials to match your existing home?
If you renovate, will you need to upgrade your home?

Depending on the ratio of renovation to new building, local building administrations may require that your home is upgraded to comply with the Building Code of Australia (BCA) – which can cost your a fortune.

Compare the size of your existing home to the size of any planned extension. If you’re planning a 300sqm addition to a 50sqm home it’ll probably be cheaper to knock the existing structure down and build new. On the other hand, a 25sqm extension to a 250sqm home is most likely financially feasible. But other factors may add to your costs.

Do you have somewhere to live while the building work is being carried out?
Are you planning on engaging the services of a builder? No matter whether you are renovating or building, this will usually speed up the work.
Do you intend to carry out the entire project in one building operation or are there advantages in completing the work in stages?

It’s usually more expensive per square meter to extend or renovate than to build a new home. This is due to a number of issues:

Joining the addition to the existing structure takes a lot of time and is quite expensive. You may need purpose-made materials to match the appearance of your current home. These can be expensive.

Access to the building area is usually restricted by established gardens or existing buildings. This means that equipment and materials may need to be brought around sound entrances manually. Equipment may even need to be winched into your backyard – an extremely expensive operation.

If you are required to upgrade your existing home to comply with building regulations, you will face considerable expense (that is, if you are able to complete the project at all).

Additions and renovations usually take longer to build, so temporary accommodation and the holding costs of finance may be an issue
Many building components in existing homes (such as water pipes, electrical cables, insulation and structure) are hidden in areas which are not accessible. This means that it’s not always possible to clearly determine the amount of work necessary to achieve compliance or a satisfactory end product.

If you can’t clearly determine the scope of works, it’s often not possible to clearly identify the associated cost of the work. This can lead to issues with lending authorities, valuations for progress payments and budget overruns. So when you’re budgeting to extend your home include a contingency sum for unforeseen work.

This doesn’t mean that a knockdown/rebuild is always more financially feasible than an extension. It’s all in the ratios – the more work that needs to be done, the more likely it will be that you’ll save money on a knockdown/rebuild.

There are also costs associated with knockdown-rebuild that you won’t face with a renovation. These include:

Demolition of existing house (typically $10,000-$15,000);
Connection and reconnection of services;
Temporary accommodation costs.

Approval by council

Obtaining building approval from local councils can be complex and time-consuming, even for an experienced melbourne builder .So if you have no experience at all, the process can be a nightmare.

A properly licensed builder melbourne will have the expertise and necessary recourses to obtain council approval as painlessly as possible

Don’t be convinced by unscrupulous operators who suggest that you go ahead with any work, including demolition, before obtaining formal development approval by your local council. You also need compliance approval by a certifying authority before commencing work.

Carrying out unapproved building work is illegal. It will also make your home more difficult to sell and significantly reduce its market value.


In most states demolition can only be carried out by a licensed demolisher. It is likely that your licensed builder can also carry out this work.

The method by which the demolition will be carried out depends upon many issues, including:

Whether the demolition is total or partial.
Whether your home is close to other buildings.
Whether the demolition is internal or external.
You will be required to engage a specialist if you are demolishing a home that contains asbestos.

And don’t forget that homes are a bit like icebergs – a lot of the structure is in the ground. If your concrete footings are large it may be cost-effective to leave them in place. This decision will need to be made on site. It is recommended that you engage a practicing engineer to inspect and report on possible issues. Drainage can usually be removed.

The removal of the in-ground services and the footings of an existing home will significantly disturb existing ground. This action can severely decrease the load-bearing capacity of the ground and should be inspected by a certified practicing engineer.

Removing services and footings also leaves big holes in the ground. These have to be filled with compacted soils, rock or concrete, which is time consuming, expensive and should not be overlooked in the budget process.

Most state building administrations are sensitive toward environmental issues and regulate the disposal of waste. Disposing of waste is expensive, so consider recycling of some of the demolished materials and saving a few dollars.

You may be able to sell some of the materials while they are still in place, on the basis that the purchaser removes them. If you choose this option talk to your insurance company regarding associated occupational health and safety and other insurance issues