project home

Why does a project home cost the same as a renovation?

If you’ve progressed any way at all down the renovation path, you would have discovered pretty quickly that it’s fairly easy to get to $250,000 without trying too hard. That kind of money will get you a ground-floor extension, but it might not cover re-doing your ensuite as well. Which is hard to understand when you flick through the Sunday papers and see page after page of project home after project home being offered for $250,000. That’s a four-bedroom, two-bathroom family home for the same price as a large living room and a kitchen reno. Whaaaaat?


And that’s when you probably ask yourself, how does a project home cost the same as a medium-size renovation? How is that possible?

Check your wardrobe

In the simplest of terms, it’s all about scale. Think about purchasing clothes from a chain store as opposed to getting custom-made garments from a tailor. The chain store clothes are pretty good – they fit ok (sometimes too long or short, but basically OK), the colour is pretty good (maybe not the exact hue you were after), and the quality is not bad (that does depend on which chain store you’re shopping at). And there’s thousands of items just like it on the racks in stores around Australia and the world.


Compare that to having a tailor or dressmaker sew a custom item for you – first they’ll measure you, then you’ll discuss design and fabric, they’ll start making the garment and there will be at least one, if not two, fittings to go through before the garment is finished. And when it is finished, it will fit you perfectly and no-one else will have an item exactly like it. It’s completely unique to you. It’s easy to see where the difference in price comes from.

A project home

It’s really the same with a project home – they have homes already designed for you to choose from. Their designs tend to have some variations to suit different block sizes and topography, but your ability to change the design is limited.


Because they’re building hundreds, if not thousands, of homes every year, the project home companies have great leverage with manufacturers and suppliers. After all, if you’re buying windows for 5000 houses every year, you’ll be paying less for them than someone who’s buying windows for five houses a year.


Because the designs are set and the materials are set, there are no surprises for the tradesmen working on the site – they’ve done the same thing many times before so they become quick and efficient at it. That keeps costs down because the project home companies know exactly how long it takes to do site works, pour the slab, erect the frame and so on and so forth.

A custom build

A bespoke renovation on the other hand is starting from scratch every single time – the design of the renovation is completely unique to your house and site. It needs to accommodate the existing building and topography, as well as your design needs. Tradesmen working on your project are, of course, experts in their trade, but they haven’t done your exact project before and there are always unexpected surprises that pop up on a job. Dealing with these takes time and can have a knock on effect to other trades.


While flatpack kitchens are great, there’s a reasonable chance that your renovation will have some kind of custom joinery that, again, is designed and will be built specifically for your house. Just like a tailor-made dress is fitted precisely to your body.


There are other differences as well – many project homes do not include driveways, landscaping and fencing in their price. And the display that looks so fabulous is usually the top of the line model that has multiple extras added to it (at an additional cost). Project home kitchens will tend to have cupboards rather than drawers, as drawers are more expensive to build.


Comparing a project home to a renovation or custom build is a bit like apples and oranges, but I think it’s good to have an idea of where those price differentials occur. Both can yield a great result and, as with everything, your budget and outcome is unique to you.


Have you built a project home or would you prefer to have a custom build?
What extras would you be happy to pay for in a project home?
Do you ever go to display villages just for fun?


  • Ashlea @ Glamour Coastal Living

    So true – perfect example of a chain store vs tailor made. Building vs doing a reno is always playing on my mind. I would love to build but fear I would go waaaay over budget 😛


      Hi Ashlea – thanks for visiting. It’s easy for costs to add up in any building work – you need to be disciplined. And I guess that’s what project homes do – give you a lot less choice and that keeps the lid on costs. Cheers, alix

  • lu @ looking for mama me

    absolutely! we are currently building and it was so much cheaper than renovating an old house. Its all about economy of scale I suppose.. They get the basic materials cheap because they buy in bulk but you don’t get a lot of choice in colours, designs etc

    Pros and cons to both I suppose 🙂


      Hi Lu – thanks for visiting. Yes, definitely less choice in a project home but sometimes I wonder if we really need ALL the choices we have these days. Personally I’ve got no desire to spend 6 weekends finding the PERFECT bathroom tiles – it’s just not how I roll. But I know there are plenty of people who love doing that. We are fortunate to all be able to make our own decisions about which way we want to go. I hope that your new build is going well – so exciting!!

  • EssentiallyJess

    Thanks for this. We aren’t in a position to build or renovate right now, but it’s handy info to have.

  • Nicole @ The Builder's Wife

    Excellent post! This is really important for those considering a renovation. It can be really surprising how quickly the cost add up. Your comparison between custom made clothes and those off the rack, is PERFECT!


      Thanks Nicole. Yes, i think it definitely makes it easy to see that it really is comparing apples and oranges!

  • Hugzilla

    This is killing me at the moment. We are just about to do a full bathroom reno that’s going to cost us over $30K. We budgeted $20K. Needless to say we were surprised at how much these things cost. We are usually the DIY types…


      Yes, good quality building costs money – but definitely worth it in a wet area like a bathroom. If it’s not done right you’ll pay for it with waterproofing issues further down the track which is no fun at all. You can read my post about bathrooms here. Hope it all goes well. Cheers.

  • Natalie @OurParallelConnection

    I get depressed when I come out of display homes. I suffer he green eyed monster as I look at my bank account and realise I will never have it


      Hi Natalie – thanks for visiting. I know what you mean! It’s like when i go clothes shopping and think “i can’t afford anything” and so I end up buying some tea towels so the day doesn’t feel like a total waste. I think the interior decorators for display home have some great ideas – any you can steal??

  • Bec @ Seeing the Lighter Side

    We’re looking at doing a knock down, rebuild in 5-10 years for this very reason. Our house is around 60 years old already and in an awkward position on the block so it just doesn’t make sense to try and tinker with it. For a bit extra we could have a whole new house! We love our area so we’re not interested in moving.


      Hi Bec – that sounds exciting. Yes, if your house isn’t situated to take best advantage of the block it can be just about impossible to correct and money spent on that still won’t get you the result you really wanted. Good luck with the project when it happens! Cheers

  • Jodi Gibson

    It depends. Many spend way too much on designer brands when a lesser known brand is just as good (sometimes even made by the same manufacture just branded differently). Getting quotes and doing research is essential if you want to
    save money and still have a quality renovation.


      Hi Jodi. Yes, I think there are upsides to both approaches – it’s just whichever one suits you best. I’m really tall so it’s hard for me to get sleeves and pants that fit so I tend to make my own. For t-shirts or dresses though, I’m generally off the rack. I think everyone has their own idea of what constitutes value and quality – in clothes and houses.

  • annette charlton

    Great comparison Alix. I am putting off following through on our plans at the moment as it will be a total demolish and then new home build. The project is too huge for us to contemplate just right now. All those choices scare me!


      Hi Annette. Yes, building a new house is a big decision and not one to rush into. Good luck with your project when you decide to go for it.

  • Kylie Purtell

    Dave and I were just discussing this the other night, it’s so weird to then come and read this post! We have been having discussions for a while now about what to do with our place. If and when we have the funds to fully renovate it might just be worth selling the house and buying/building something else. On the other hand, we really love where we live, but the house is very, very old. We’ve discussed potentially doing a knock-down re-build, but that idea needs a lot further investigation. If we did go the knock-down route we would definitely just go with a project home, neither of us are particularly fussy people when it comes to homes and homewares, I’m a function over form kinda girl. Yes pretty things & fancy features are great, but as long as the basic layout & design of the house works for us that’s all I’m worried about. I don’t need a big walk-in pantry, ensuite bathrooms, etc. As long as it’s got built-in wardrobes, 2 toilets (don’t even need two bathrooms, just two toilets, lol!) and an internal laundry (rather than our washing machine & tub in the garage situation) I’ll be a happy girl!


      Hey Kylie – thanks for visiting. Exciting times for you! Even though my husband runs a custom building company, we can certainly see the attraction of a project home – costs are fixed, the process (in general) is simpler and depending on your price point you don’t need to skimp on features. Just make sure you know exactly what you’re getting as project home costs often don’t include any exterior works, ie driveway, landscaping, paving etc and you will definitely want to have money put aside for that so that you are not living in a lovely new house that’s perched on a blank patch of dirt. Good luck with your project!

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