select
|

Check building costs to get value for money


Everyone knows that newly-built homes generally cost more, meter for meter, than pre-owned properties, but many people still dream of building a new home from scratch and they need to be sure that they are getting the best possible value for money.
 
“Clearly there are many factors to be taken into account when arriving at a realistic market price for any property,” says Realty 1 International Property Group CEO Hano Jacobs, “including location, design, building quality and craftsmanship.
 
“However, all those factors being equal, a solid starting point for assessing the relative value of a new home is building costs, and in this respect some useful information about costs in Gauteng during the second quarter of this year has been compiled by quantity surveyors Hill Du Bois (see
www.hilldubois.co.za).’
 
These figures show that at the top end of the scale, the base building cost (excluding external works, professional fees and finance charges) for a luxury cluster home now ranges between R7100 and R8600/sqm.  External works and services will add about R1050 to R1300/sqm meter to this cost.
 
The firm also says units defined as GASH (good address, small home) housing, should cost between R3900 and R5000/sqm to build, and puts the building costs for duplex houses and apartments at between R5000 and R5900/ sqm.    
    
“Although such figures cannot be viewed as absolutes, they are interesting in the sense that they provide an insight into what buyers can expect to pay for different types of home,” says Jacobs.
 
He also says that for those determined to buy a newly-built home rather than a pre-owned one, now is probably the best time to do so – “provided they are sure that their developer or builder is not loading the price of units to try to recoup holding costs incurred during the recent recession.
 
“They should bear in mind that although there have been huge building input cost increases over the past 10 years, with the PPI for building materials reaching 18,4% year-on-year in November 2008, materials cost inflation has actually been declining since the start of 2010.
 
“This has brought the replacement cost gap (the difference between the average price of an existing home and the cost of replacing it) to around 20% - meaning that a newly-built home should only cost around one-fifth more now than a comparable pre-owned property, which is a great improvement on the situation during the last boom, when the replacement cost gap was more than 30% in many areas.”
 
Issued by
Realty 1 International Property Group


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 22 Jan 2018
      Moving away from the city to a country or coastal town and a slower-paced life is a frequent new-year resolution for South Africans, but thorough research should be done before you break free from the hustle and bustle, because making the wrong move could turn out to be a very expensive mistake, and even more stressful for you and your family than staying in the “big smoke”.
    • 22 Jan 2018
      Cape Town is home to many breathtaking and historic homes, but House Invermark designed in 1969 by South African architect Gilbert Colyn, with inspiration from two modernist icons: the Glass House by Phillip Johnson and Farnsworth House by Ludwig Mies van der Rohe is in a class of its own.
    • 22 Jan 2018
      2017 was a challenging year for the South African property market in general, despite small pockets of thriving activity in areas like the Western Cape. As we head into 2018, Tony Clarke, Managing Director of the Rawson Property Group, casts his eye forward to property trends and market influences that could make their impact felt in the New Year.
    • 19 Jan 2018
      Extending from Randfontein in the west to Roodepoort in the east and including the towns of Krugersdorp and Magaliesburg, the West Rand has a plethora of property available to residents who choose to make this unique area their home.
    • 19 Jan 2018
      When it comes to financial planning, doing the work to ensure you’re prepared for unexpected emergencies is just as important as ticking off your other goals and New Year’s resolutions. The beginning of the year is also the perfect time to review your various insurance policies.
    • 19 Jan 2018
      No surprises at the first Monetary Policy Committee of 2018, as Reserve Bank Governor, Lesetja Kganyago, announced that the interest rates would stay at their current levels.
    • 18 Jan 2018
      The Southern Suburbs make up some of the most popular residential areas in Cape Town, comprising charming groups of suburbs which lie to the south-east of the slopes of Table Mountain. It is seen as the city's most expensive residential neighbourhoods with a choice of various private schools, upmarket eateries, wine estates, beautiful homes and trendy apartments.
    • 18 Jan 2018
      New year, new goals! If you’ve resolved to purchase your first property in 2018, then this 6-step guide from the Rawson Property Group is a must-read. It will help you navigate and simplify what is often be seen as a confusing process of buying your first home – right from the house-hunt to the house-warming.
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK