After a recent comparison to the cost to build new homes in surrounding suburbs of Bunbury it was found that compariable established homes on the market are for sale below replacement cost.
Mr Morgan, managing director of Harcourts Bunbury said “The has been a great deal of press about House pricing dropping even further but it is very, very hard to see established homes selling much below what it would cost to replace them.”
“To build a new home at the moment, the cost of materials have recently rised and with the new energy rating about to be introduced and carbon tax a new home costs could be increased again.”
“These changes to new building are not making it any cheaper to build and are set to be more advantageous to the established market.”
Mr Morgan stated an example in Usher which is an established area next to Dalyellup, where you can purchase an 5 bedroom home with study around 200m2 of home, double carport and double garage with ducted airconditioning on an 900m2 block for $340,000, whereas to build this same home on large block about 600m2 in Dalyellup $169,000 and 200m2 home $180,000, plus ducted air conditioning $6,000, rear landscaping, carpets and internal fitout allowance of say $15,000 pushes a new home around $370,000 and we still may have missed something.
Mr Morgan, went on to say “For home affordability to change preconcived ideas on block sizes and building materials are going to have to be investigated along with the desire for the standard 4 bedroom home.”
For more information Richard Morgan can be contacted on (08) 9722 6666.