Home Extension Cost Guide Melbourne (2026)

Home extension cost per square metre

These are indicative Melbourne ranges for the build itself. Where a project lands within each range depends mostly on the site, the structure and the level of finish.

• Ground-floor extension — $1,800 to $3,000 per m². Family rooms, extra bedrooms or a bigger kitchen, built out from the existing house.
• Second-storey addition — $2,500 to $4,500 per m². Building up when the block has no room to build out.
• Granny flat (60 m² small second dwelling) — $120,000 to $180,000. A self-contained home on the same lot.
• Knockdown rebuild — $400,000 to $850,000+, including demolition. Starting again with a new home on your existing block.

What a typical extension might cost

Multiplying the floor area by the per-square-metre range gives a sensible first estimate. These examples are illustrative only:

• A 25 m² ground-floor family room: roughly $45,000 to $75,000.
• A 40 m² ground-floor extension that includes a second bathroom: toward the upper half of the range, because wet areas cost more per square metre than living space.
• A 50 m² second storey with two bedrooms and a bathroom: roughly $125,000 to $225,000.

Why second storeys cost more per square metre

• The existing structure usually needs engineering, and sometimes strengthening, to carry the new floor.
• Part of the roof comes off, so the house has to be kept weatherproof during the build.
• A staircase takes up floor space on both levels and adds cost of its own.
• Scaffolding and safety measures for working at height, and crane hire on some sites.
• Disruption: some families move out for part of the build, which belongs in the budget too.

What pushes the price up

• Kitchens, bathrooms and laundries in the new space — plumbing, waterproofing and fixtures add cost quickly.
• Reactive clay soils, common across parts of Melbourne's west, can call for deeper or engineered footings. A soil report tells you early.
• Difficult access for machinery and deliveries, or a sloping block.
• Matching existing bricks, cladding or roof tiles so the extension blends in.
• Opening up the existing house with structural steel beams.
• Relocating sewer, stormwater or electrical services that sit where the extension will go.
• Asbestos in older homes, which needs testing and safe removal before work starts.

Costs people forget to budget for

• Design: a draftsperson or architect, plus a structural engineer.
• Site investigations: a soil test and a feature and level survey.
• Building surveyor fees and the building permit, plus a planning permit if your property needs one.
• Warranty cover: Home Warranty applies to eligible domestic building work valued at more than $20,000 under contracts signed on or after 1 July 2026.
• Temporary accommodation or storage if you move out during the build.
• Landscaping, fencing and driveway repairs once construction finishes.
• A contingency for hidden conditions, especially in older homes.

Do you need a permit for an extension?

Almost every extension needs a building permit from a registered building surveyor, and work can't start until it is issued. Some also need a planning permit, for example where an overlay applies to the property or the design doesn't meet the planning scheme's siting rules. Our Victorian permit guide explains the difference.

For domestic building work costing more than $10,000, Victorian law requires the builder and owner to enter into a written major domestic building contract.

How to keep an extension on budget

• Finalise the design and your selections before you sign, so the contract price reflects what you actually want.
• Keep new wet areas close to existing plumbing where you can.
• Compare building out with building up — on a large enough block, a ground-floor extension is usually cheaper per square metre.
• Use standard window and door sizes where they suit the design.
• Ask for an itemised quote with any provisional sums clearly listed, and agree every variation in writing.