How to Calculate Extension Costs in Melbourne

Planning a home extension in Melbourne requires careful budget planning. The cost of extension Melbourne projects varies significantly based on size, materials, and complexity.

We at Cameron Construction see homeowners underestimate expenses regularly. Understanding all cost components helps you make informed decisions and avoid budget surprises during construction.

What Drives Extension Costs in Melbourne

Square Metre Pricing Across Extension Types

Extension costs in Melbourne range from $2,800 to $5,500 per square metre based on complexity and finishes. Ground floor additions typically cost $2,800 to $3,800 per square metre for standard specifications, while double storey extensions command $3,200 to $4,500 per square metre due to structural requirements. Second storey conversions fall between $3,500 to $5,500 per square metre because builders must remove existing roofs and modify structural elements. The Valuer-General Victoria releases comprehensive sales data for houses, units, vacant residential land and commercial, industrial and rural properties, providing market insights that influence construction costs.

Material and Labour Cost Variables

Material choices dramatically impact your budget. Engineered timber floors add $80 to $150 per square metre compared to laminate at $25 to $60 per square metre. Premium kitchen stone benchtops cost $400 to $800 per square metre versus laminate at $200 to $400 per square metre. Labour represents 35% to 45% of total extension costs in Melbourne.

Skilled trades like electrical and plumbing charge $85 to $120 per hour, while general construction labour ranges from $65 to $90 per hour. Regional Victorian areas show 5.8% higher cost increases compared to Melbourne (according to Valuer-General Victoria data).

Council Fees and Permit Requirements

Council permits cost between $1,200 to $3,500 based on extension value and council requirements. The Building Permit Levy applies to projects that exceed $10,000, calculated at rates that vary with estimated construction costs. Planning permits add $1,500 to $4,000 for extensions that require council approval, particularly in heritage overlay areas common around Melbourne’s CBD. Soil reports cost $800 to $1,500 but prevent foundation surprises that can add $5,000 to $15,000 to budgets. Domestic construction insurance becomes mandatory for projects that exceed $16,000, typically costing 0.2% to 0.5% of contract value.

These base costs form just the foundation of your extension budget. Several additional expense categories can significantly impact your final investment, particularly when builders encounter unexpected site conditions or project complexities.

What Does Each Extension Type Actually Cost?

Double Storey Extension Investment Breakdown

Double storey extensions deliver the highest value per dollar spent but require substantial upfront investment. Structural engineers are required because builders must design foundations that support two levels plus modify existing roof structures. Scaffolding adds $2,500 to $4,500 for safe access during construction. The building envelope (including external cladding, windows, and roofing) represents 25% to 30% of total costs.

A typical 60 square metre double storey extension ranges from $210,000 to $330,000 including all structural modifications. Electrical rough-in costs increase 40% compared to single level extensions due to additional circuits and safety requirements for upper floors.

Ground Floor Addition Cost Components

Ground floor additions offer the most predictable pricing structure in Melbourne extensions. Site preparation including excavation and concrete footings costs $8,000 to $15,000 for typical residential extensions. Roof modifications to integrate new spaces with existing structures add $12,000 to $25,000 depending on complexity. Internal finishes including flooring, painting, and fixtures represent 35% to 40% of total extension costs. Kitchen integration work costs an additional $15,000 to $35,000 when extending existing cooking areas. A 40 square metre ground floor addition typically costs $100,000 to $140,000 with standard finishes and moderate complexity.

Second Storey Conversion Budget Reality

Second storey conversions carry the highest risk for cost overruns because builders work within existing structural constraints. Roof removal and reconstruction costs $25,000 to $45,000 before any internal work begins. Structural modifications to support additional loads add $15,000 to $30,000 including steel beams and reinforcement. Staircase installation consumes valuable floor space and costs $8,000 to $18,000 for quality timber or steel construction. Waterproofing and insulation upgrades to meet current building codes add $12,000 to $20,000. Most second storey conversions exceed initial budgets by 15% to 25% due to unforeseen structural issues discovered during roof removal.

These visible costs represent only part of your total investment. Several additional expenses often catch homeowners off guard and can significantly impact your final budget.

What Hidden Expenses Inflate Your Extension Budget

Site Access Complications Drive Up Costs

Narrow driveways and limited street access force builders to use smaller equipment and hand-carry materials, which increases labour costs by 20% to 35%. Crane hire becomes necessary when rear extensions lack direct access, costing $1,200 to $2,800 per day (depending on reach requirements). Protection boards for existing landscaping and neighbouring properties add $2,500 to $5,500 to project budgets. Council permits for street closures or skip bin placement cost $150 to $400 per week in most Melbourne councils.

Asbestos testing becomes mandatory on older properties, particularly those built before 1980, adding $800 to $2,200 when builders discover hazardous materials during excavation.

Temporary Accommodation Creates Financial Pressure

Kitchen and bathroom renovations force families into temporary accommodation or expensive takeaway meals for 6 to 12 weeks. Rental accommodation costs $350 to $650 per week for basic two-bedroom units near construction sites. Hotel stays during critical construction phases add $180 to $280 per night when dust, noise, or safety concerns make homes uninhabitable. Storage unit rental for furniture and belongings costs $120 to $280 per month, with most extensions requiring 3 to 6 months of storage. Food expenses increase by $200 to $450 per week when construction renders kitchens unusable (particularly challenging for families with children who require regular meal schedules).

Utility Infrastructure Upgrades Surprise Budgets

Electrical panel upgrades become mandatory when extensions add significant load, costing $2,800 to $4,500 for modern safety switches and circuit capacity. Gas meter relocations cost $1,200 to $2,800 when extensions conflict with existing utility positions. Water pressure boosters add $1,800 to $3,200 when new bathrooms or kitchens exceed existing supply capacity. NBN and telecommunications reconnection fees range from $300 to $800 per service when cables require rerouting around construction areas. Sewer connection modifications cost $2,200 to $4,800 when new bathrooms exceed existing pipe capacity or require pump systems for below-ground installations.

Final Thoughts

Extension costs in Melbourne depend on multiple factors beyond basic square metre rates. Material choices, labour availability, council requirements, and hidden expenses like site access complications significantly impact your final investment. The cost of extension Melbourne projects ranges from $100,000 for basic ground floor additions to $330,000 for complex double storey extensions.

Professional quotes from experienced builders provide accurate cost breakdowns and identify potential budget risks early. We at Cameron Construction recommend that you obtain detailed estimates that include all permit fees, utility upgrades, and site-specific challenges. Our team helps homeowners avoid costly surprises through comprehensive project planning.

Start your extension journey when you define your space requirements, establish a realistic budget that includes 15% contingency, and engage qualified professionals for soil reports and structural assessments. Proper planning prevents budget overruns and delivers the functional, valuable living spaces Melbourne families deserve. Contact Cameron Construction to discuss your extension project with our experienced team.