Building A Duplex In Sydney: Cost Considerations And Maximising Profit
When searching for details on duplex properties in Sydney, consider the challenges of building them compared to the benefits. You might be wondering how to maximise your investment’s return while lowering costs that impact your earnings. Making decisions that align with your financial objectives requires awareness of these issues.
In Sydney, duplexes are becoming a more favoured investment. This is because they provide various options, such as renting both units or living in one and renting out the other. Due to the high demand for rentals in Sydney, the dual-income strategy increases rental revenue potential, making duplexes an even more alluring investment option.
To optimise your profits, you must be aware of all associated expenses. Everything from purchasing land to building supplies and continuing upkeep will impact your business. Prudent budgeting and cost control are the secrets to making your investment profitable in the long run.
Having invested in and developed real estate for many years, I have seen firsthand how good planning can result in significant financial gains.
Let’s examine the expenses of constructing a duplex in Sydney and consider strategies for making the most of your investment.
Understanding the duplex building process
A duplex is a house split into two separate homes that share a wall or floor. You can make it an excellent investment because you can live in one part and rent out the other. Some necessary steps when building a duplex home are:
1. Planning
First, check if you’re allowed to build a duplex in your area. Then, ensure you have enough land and determine how much it will cost.
2. Design
Work with architects and engineers or a builder who has duplex designs already prepared, to create an aesthetically pleasing, practical layout. Make sure it follows all the local building rules.
3. Construction
Hire certified, good builders like Provincial Homes who know what they’re doing. Ensure everything is built safely and according to the rules.
4. Paperwork and money
Get all the necessary permits. Find ways to fund the duplex home, such as getting a loan. Comply with regulations on insurance and property details.
How much does it cost to build a duplex in Sydney?
Land purchase
You’ll need a decent-sized piece of land, about 400-500 square metres. Depending on where you want to build, that could set you back anywhere from $600,000 to $1.5 million in Sydney.
Construction costs
Expect to pay between $400,000 and $700,000 for each unit. The exact cost depends on its size, how fancy you want it, and what materials you use. About a quarter to a third of this goes to paying the workers.
Professional fees
Architects usually charge 5% to 12% of the building cost, and builders take another 10% to 20%. You’ll also need to pay a surveyor to assist you with the actual subdivision of the land, which is usually a few thousand dollars.
Legal and financial costs
There are legal fees, which are usually a couple thousand dollars. You’ll also have to pay stamp duty on the land. If you’re borrowing money, the bank will charge you a fee, too, usually about 0.5% to 1% of what you borrow.
