Is your renovation budget a realistic plan or a risky proposition? If you are planning a project this year, you cannot rely on 2024 data or generic online estimators that miss the mark by tens of thousands of dollars. You need to consider home renovation costs in 2026. The post-pandemic home remodel cost surges have settled, but we are now dealing with a market defined by high skilled labour rates and strict energy compliance standards.
As licensed builders, we see home renovation quotes every day. We know that generic online calculators are often $50,000 off the mark. In this guide, we will break down exactly how much does it cost to renovate a house in Australia right now, from cosmetic updates to full structural extensions, so you can make a smart move with your budget.
Quick Answer: Average House Renovation Cost in Australia (2026)
Every site is different, but 2026 trends show a stabilisation in material prices (timber and steel have levelled off) but continued upward pressure on specialised labour. Trades like tilers and waterproofers are charging premiums due to high demand.
Use these 2026 builder benchmarks for a realistic house renovation price:
- Cosmetic Update: $20,000 – $80,000 (Includes: Painting, floor sanding, replacing fixtures, and lighting updates.)
- Full Internal Renovation: $80,000 – $300,000+ (Includes: New kitchen and bathrooms, flooring, non-structural wall removal.)
- Structural Extension: $150,000 – $550,000+ (Includes: A second storey, ground floor extensions, foundation work, and roofing.)
House Renovation Cost by Project Type
The most accurate way to estimate early-stage budgets is to understand the renovation cost per square meter is
Cosmetic / Light Renovation
Range: $1,200 – $2,500 per m²
Cheap house renovation do not have to be of low quality; they just involve working with the existing footprint, as you are just refreshing the surfaces. This category requires no council approval (typically) and no structural changes.
- Scope of Work: Wall and ceiling repainting, laminate or hybrid flooring overlay, cabinet door replacement (kitchen resurfacing), and an upgrade of blinds.
- Builder Tip: It is the finest ROI method for renovating to sell quickly.
Major Renovation
Range: $3,000 – $5,000 per m²
This is the standard full house remodel cost for families that plan to stay in their current home for more than ten years. It requires stripping a room down to its brick walls.
- Scope of Work: Layout changes (removing non-load-bearing walls), complete kitchen and bathroom remodels, rewiring, re-plumbing and installation of new windows/doors.
- Hidden Cost: Older homes may require switchboard upgrades ($1,000-$3,000) to accommodate modern appliances.
Structural Extensions
Range: $5,000 – $8,000+ per m²
This is the cost of renovating a house when you change its shape. You must obtain council DA/CDC approval, engineer requirements, and 7-star energy compliance since you are making changes to the structural integrity of your building.
- Scope of Work: Second-storey expansions, excavation, new slab pouring, and moving load-bearing walls.
- Why it costs more: You are not just paying for the extra room; you are also paying to integrate it structurally and aesthetically into the old house (structure).
Renovation Cost by Room (2026 Benchmarks)
We have updated our internal pricing data to reflect the current house reno costs for specific rooms. It should be noted that wet areas cost a premium because they require up to six different trades (plumber, waterproofer, tiler, electrician, carpenter, and painter).
|
Room |
Budget (Basic) |
Mid-Range |
High-End (Luxe) |
|
Kitchen |
$20,000 – $35,000 |
$35,000 – $65,000 |
$75,000+ |
|
Bathroom |
$15,000 – $25,000 |
$25,000 – $45,000 |
$55,000+ |
|
Bedroom |
$2,000 – $5,000 |
$5,000 – $12,000 |
$20,000+ |
|
Living Room |
$10,000 – $15,000 |
$15,000 – $35,000 |
$45,000+ |
The 2026 Material Price Index: What Has Changed?
You must look at the specific materials used in 2026 to understand your home remodel cost. The inflation has slowed, but the Producer Price Index for construction remains 2.3% higher than last year.
- Steel and Timber: Prices have finally decreased by roughly 4.6% since 2025. This makes structural framing slightly more predictable.
- Cement and Concrete: Costs have risen by 5.2%. If your entire home renovation cost includes a new slab or driveway, expect higher quotes for the ground phase.
- Ceramics and Glass: The tiling and glazing costs are up 2.6%. It directly impacts bathroom renovation cost 2026 and kitchen splashback budgets.
What is the most expensive part of renovating a house?
When calculating your whole house renovation cost, wet areas (kitchens, bathrooms, and laundries) will consume the majority of your budget per square metre. It is due to the concentration of licensed trades required in a small space. You cannot DIY waterproofing or electrical work in Australia; it is illegal and voids your insurance.
Structural steel and foundation work are also some of the biggest budget killers. If you remove a load-bearing wall to create an open-plan living area, the cost to remodel house spikes. You need temporary propping, engineering certification, and heavy steel beams installed. In 2026, raw structural steel ranges from $2,300 to $2,800 per tonne, but once you factor in fabrication, delivery, and craneage for a residential site, the installed price can reach $4,000+ per tonne.
Always budget a 15-20% contingency for groundworks; finding rock during excavation or old terracotta pipes can add thousands to the bill instantly.
The 7-Star Energy Mandate: A New 2026 Budget Reality
In 2026, any major full home renovation cost must account for the National Construction Code (NCC) 7-star energy efficiency standards. This is no longer optional for structural renovations.
- Thermal Performance: You may need upgraded insulation (R-values) and thermally broken double-glazed windows.
- The Whole-of-Home Budget: It requires efficient hot water systems and lighting.
- Cost Impact: Expect these compliance measures to add between $10,000 and $25,000 to a major renovation project. However, the ROI is high, as these homes are cheaper to run and hold higher resale value.
Is it cheaper to renovate or buy another house?
In the 2026 property market, the data strongly supports renovating. The buying and selling expenses associated with changing homes are now too high. When you trade up to a new home, you will face:
- Stamp Duty: On a median Sydney house price ($1.6M+), stamp duty alone can exceed $75,000.
- Agent Fees: The cost of selling your current house is about 2% plus marketing, which comes to between $25k and $35k.
- Cost of Moving: $3–$5k for removalists and legal fees.
That is over $100,000 of dead money that goes away without adding value to your asset. If you invest that same $100,000 into affordable home renovations or a complete house renovation cost, you are adding direct equity to your property. So, renovating is the financially superior exit/entry strategy this year, unless you need a completely different location.
Can home loans include renovation costs?
Yes, it is common practice in 2026 to finance a renovate home cost. Banks have tightened lending criteria, but there are still multiple options:
- Construction Loans: If you want to start with major structural construction, the bank releases funds in progress payments directly to the contractor at key completion points (such as slab down, frame up).
- Equity Top-Up: If you have significant equity, you can refinance to cash out funds. It gives you flexibility for inexpensive home renovations where you might be managing trades yourself.
Important Note: Banks almost always require a fixed-price building contract for construction loans. They need to value the home as-if-complete to approve the loan. Cost-plus contracts are rarely accepted for finance because the final price is not guaranteed.
Location Factor: Sydney & Central Coast vs. National Averages
There is a notable labour premium in New South Wales, particularly in Sydney and the Central Coast. The demand for qualified builders in this area exceeds supply, causing home renovation quotes to rise.
Regional areas may have lower labour rates, but renovation cost per square metre often balances out due to higher freight costs for materials and travel allowances for trades.
|
Location |
Cost Range (per m²) |
Notes |
|
Sydney Metro |
$3,500 – $7,500+ |
Highest labour costs; difficult site access adds to price. |
|
Melbourne |
$3,000 – $6,000 |
Slightly lower trade rates than Sydney; competitive market. |
|
Regional / Rural |
$2,000 – $4,000 |
Lower labour, but higher logistics/transport costs. |
Design and Management Fees: The Soft Costs
A number of home renovation quotes only cover the construction. You must factor in professional fees to get the full home renovation cost:
- Architect/Draftsperson: 5% – 15% of the total build cost for detailed plans.
- Interior Designer: $2,000 – $10,000 based on whether they are just choosing colours or designing custom joinery.
- Council/Permit Fees: $1,500 – $5,000 for DA (Development Application) or CDC (Complying Development Certificate) approvals.
- Surveyors and Engineers: $2,000 – $4,500 for soil tests, site surveys, and structural drawings.
How GTG Constructions Prices Your Project
We use a concept-to-completion strategy, which provides you a fixed price before we begin the process. It protects you from industry-wide budget problems.
Check how real budgets look for recent clients:
Project A (Cosmetic Refresh)
A 3-bedroom home in the suburbs. Interior painting, floorboard sanding, new kitchen cabinetry (with appliances), and a new vanity.
Cost: Approximately $55,000.
Project B (The Open Plan Renovation)
It involves removing two walls to merge the kitchen/living area, installing a structural steel beam, installing a new premium kitchen with an island, and installing new timber flooring.
Cost: Approximately $140,000.
Project C (The Extension)
The ground-level expansion includes a master suite (bedroom + ensuite) and a rumpus room (a room for playing games, typically in the basement of a house.) (45 m² total). The brick veneer (a property of either a wooden or steel frame concealed with a single layer of bricks as the exterior layer) matches.
Cost: Approximately $290,000.
Visit our Home Renovation Page to see more examples.
2026 Renovation Checklist: Avoid the Errors
Before you ask how much would it cost to remodel a house, run through this checklist to avoid common budget traps:
- Asbestos Check: If your home was built before 1990, it likely contains asbestos. Removal by specialists can add $2,000 – $10,000 to a full house remodel cost.
- Site Access: Can a skip bin fit in your driveway? Can a concrete pump reach the back? Tricky access adds extra labour hours.
- Temporary Living: If you don’t stay in the house during the renovation process, you need an Airbnb for 12 weeks. Add $8,000–$15,000 to your total budget.
- Termite Damage: When the walls are opened, old damage can be revealed. This is why a 15% contingency is non-negotiable.
FAQ: House Renovation Costs 2026
How much does it cost to renovate a home?
In 2026, the average Australian entire home renovation cost sits between $3,000 and $5,000 per square metre for a standard mid-range finish. Budgets typically start at $120,000 for internal works for a full 3-bedroom home and can exceed $300,000 if major structural changes or extensions are involved.
Can home loans include renovation costs?
Yes, most Australian lenders allow you to use home equity or a specialised construction loan to fund renovations. You will typically need a fixed-price contract from a licensed builder for the bank to approve the funds based on the as-if-complete valuation of your property.
Is it cheaper to renovate or buy another house?
When the hidden costs of selling are taken into account, such as stamp duty, which can reach $50,000 on a median-priced Sydney home, renovating is now less expensive. You can update your current space to avoid these transactional costs (plus agent fees and moving costs) and build immediate equity in your existing asset.
What is the most expensive part of renovating a house?
The kitchen and bathrooms are the most expensive rooms to renovate because they require multiple specialised trades (plumbing, waterproofing, electrical, and tiling) and high-cost fixtures. However, structural changes, such as removing load-bearing walls or adding a second storey, are often the highest single expense in a project due to engineering and labour requirements.
