That’s skyrocketed from the pre-pandemic era and just about doubled over the past decade.
The costs are now at a record high and a u-turn seems unlikely.
“Labour and materials costs jumped when the pandemic began as lockdown-era stimulus of the construction industry collided with a global inflation breakout, and costs show no sign of reverting to previous levels,” reports Domain.
Domain has analysed ABS building approvals data to validate what home builders already know. Here’s what the stats look like:
- The average cost to build a new home was $504,109 as at March 2025.
- That’s 6.5 per cent higher than a year ago when the cost was $473,230.
- It’s a 52.6 per cent increase since March 2019 when it was just $330,430.
Master Builders Association Australia chief economist Shane Garrett told Domain that the time to build a house had also blown out due to labour shortages.
“Time is money when it comes to home building, so the longer it takes to build, the more money you have tied up in it,” he said.
“People have to be paid by the hour when it comes to the construction business and when it gets stretched out over a considerably longer period, that also generates cost increases.”
If you’re looking to build, it is important to work with your builder on a clear schedule and budget. A fixed construction cost contract is a good way to mitigate risks of time and money over runs.
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