Rates
What does a renovation
actually cost per
square metre?
Published rates run $2,700 to $5,100 per square metre for extensions and $1,600 to $3,900 for renovation inside an existing building. Real projects routinely land 40 to 70% above the rate — not because the rate is wrong, but because of what it deliberately excludes.
The published rates
| Scope | What the rate covers | Rate |
|---|---|---|
| Extension / new construction | Basic shell and extended roofline | $2,700 – $5,100/m² |
| Renovation within existing building | No structural upgrade assumed, good access | $1,600 – $3,900/m² |
| Second-storey addition | Shell rate plus first-floor uplift | $3,400 – $6,400/m² |
Extension and renovation rates: Archicentre Australia CostGuide 2026 · GST inclusive
Second-storey uplift: AE Index
Why your project will exceed the rate
The rate is not a lie. It is a shell figure, and a house is not a shell. Four categories sit outside it, and together they commonly add 40 to 70%.
Wet areas
Kitchens, bathrooms and laundries are costed separately because they need fittings, waterproofing and services the shell rate never accounted for. One kitchen and one bathroom is $40,000 to $84,000.
The existing house
Restumping, rewiring and re-plumbing are work to the part you are not extending. On pre-1940 stock, allow around $26,000.
Professional fees and permits
Architect, engineer, building surveyor, permit levy and energy assessment. Roughly 25% on top of construction, and compulsory.
Site conditions
Location, access, heritage and slope are multipliers on the rate, not additions after it — which is why they compound rather than simply add.
A worked example
A 45 square metre rear extension in Northcote, mid finish, on a 1920s weatherboard with restricted access:
| Line | Amount | |
|---|---|---|
| Shell | 45 m² × $3,900/m² | $175,500 |
| Site adjustment | Inner suburb × restricted access | ×1.28 |
| Shell subtotal | $224,600 | |
| Wet area | One bathroom | $26,000 |
| Existing house | Pre-1940 allowance | $26,000 |
| Professional fees and permits | 25% | $69,150 |
| Contingency | 12% | $41,490 |
| Total | Effective rate: $8,600/m² | $387,000 |
The headline rate was $3,900. The real rate was more than double it. Neither number is wrong — they measure different things, and confusing them is the most expensive mistake in residential renovation budgeting.
How to use rates properly
Use published rates to sanity-check a builder's construction figure, not to budget a project. For budgeting, start from the rate and add the four categories above. That is exactly what our estimator does, line by line, so you can see which part of the number is which.
See every line of the maths
The estimator shows the base rate, each site adjustment, wet areas, professional fees and contingency as separate visible lines.
Common questions
What is the average cost per square metre to renovate in Melbourne?
Published rates are $2,700 to $5,100 per square metre for extensions and $1,600 to $3,900 for renovation within an existing building. Real all-in project costs commonly work out at $6,000 to $9,000 per square metre once wet areas, work to the existing house, professional fees and contingency are added.
Why is my quote so much higher than the published rate?
Published rates cover the basic shell and roofline only. Wet areas, structural work to the existing house, professional fees, permits and contingency all sit outside them, and together they commonly add 40 to 70%.
Is renovating cheaper per square metre than building new?
Renovation within an existing building has a lower published rate than new construction, but the gap narrows once services upgrades and structural work to the old fabric are counted. On badly deteriorated stock, renovation can cost more than replacement.
How do I compare two quotes using cost per square metre?
Carefully, and only after establishing that both quotes cover the same scope. Dividing two totals by floor area tells you very little if one includes the kitchen and the other treats it as a provisional sum.
Related
When you are ready to build
AE Index is not a building company. When a project is ready to be priced properly, we pass it to a builder from our verified network — who will walk the site, inspect what is under the floor, and put a fixed price in writing. We are paid a fee by them on work that proceeds, and you are under no obligation to use them.
- Current domestic builder registration, confirmed with the Victorian Building Authority
- Domestic building insurance current and sighted
- Two completed projects contacted directly — not supplied testimonials
- Fixed-price contracts with a written variations policy
- Re-checked annually, and removed from the network on any lapse
Last updated 28 July 2026