8 Hidden Costs Of Renovating in Australia
Renovating your home can be an exciting yet daunting task. It’s a great way to increase property value, improve functionality, and make your living space truly feel like your own. However, when it comes to budgeting, home renovations have a sneaky way of unveiling unforeseen costs—sometimes only after the work has begun. These hidden costs of home renovations in Australia can add up quickly and push your budget beyond your comfort zone.
From unforeseen structural repairs to the rising costs of materials, many homeowners are surprised by the full financial commitment needed for a successful renovation. And while architect and builder fees are expected, other expenses, like council permits, utility upgrades, and unexpected delays, can often go overlooked until they’re unavoidable.
Drawing from years of experience working with clients facing similar challenges, I’ve seen first-hand how important it is to plan for these “hidden” expenses to avoid a budget blowout. In this article, we’ll break down the most common hidden costs of renovating a house, so you can plan wisely and set realistic expectations. Knowing what to anticipate can help you protect your budget, ensure a smoother renovation process, and ultimately bring your dream space to life without the financial surprises.
1. Relocation Costs
One of the most commonly overlooked hidden costs of renovating is relocation. From my experience with customers at Ross’s Discount Home Centre, this cost tends to slip through the cracks during the early planning stages. The reality is that depending on the scale of your renovation, staying on the property may not be feasible—or comfortable. Renovations can disrupt essential amenities like your kitchen, plumbing, or electrical systems, making the home virtually unlivable.
Experienced renovators know to consider moving out before the more invasive stages of a renovation begin. However, this decision brings costs of its own. Whether it’s short-term rental accommodation, a hotel stay, or even a self-storage unit for your belongings, these expenses add up quickly. And while staying with family or friends may sound like an option, it’s rarely ideal for extended periods.
If your project is extensive or involves kitchen or bathroom renovations, it’s wise to plan for temporary relocation and add it to your budget. For tips on managing your renovation efficiently without necessarily moving out, check out our article on How to Renovate Without Moving Out.
2. Council Permits and Certifications
Depending on where in Perth you live, you may have to obtain several council permits and certifications for your renovation. It is extremely important to obtain these approvals before your renovation kicks off. Otherwise, you may end up paying hefty fines or risk your project from being stopped by surprise inspections.
Also, the cost of certifications and permits also varies from one council to another. Costs may range from a few dollars up to hundreds of dollars. Make sure to do your research before you begin and budget for it accordingly. You can visit the Department of Commerce website for more information about permits and certifications in Perth.
3. Taxes
When it comes to the hidden costs of renovating, taxes are often overlooked, especially for property investors in Perth, WA. While renovations on your primary residence generally avoid tax implications, renovating an investment property is a different story.
For investment properties, two primary tax considerations apply: Goods and Services Tax (GST) and Capital Gains Tax (CGT). If your renovation involves significant construction work or upgrades, GST may apply to certain materials and services. Additionally, the costs associated with these improvements can impact your capital gains tax when you eventually sell the property, as renovations may increase the property’s assessed value. This can result in a higher tax liability, particularly if the renovations substantially increase the sale price.
To navigate these tax implications effectively, consult with a local tax advisor or review the Australian Tax Office (ATO) guidelines, as they outline specific deductions available for investment property renovations. For instance, certain expenses related to the upkeep or repair of an investment property may be tax-deductible in the year they’re incurred, while improvements that add value may be deducted over time through depreciation. By understanding these distinctions, you can make informed decisions on which costs can be claimed as deductions, helping you budget more accurately for your renovation.
For further guidance, visit the ATO’s website for a detailed breakdown of allowable deductions and tax implications specific to renovations on investment properties.
4. Equipment and Material Costs
Unless you’ve managed a home renovation before, chances are that you won’t have the required tools for the job. Depending on the size and scope of your renovation, you may have to purchase a few or several tools. The cost of new equipment can easily add thousands of dollars to your budget!
You can also consider hiring tools instead of purchasing them. However, hiring means you must be careful with your schedule. Renovations always meet roadblocks and delays and will only result in higher costs. Look at websites like Bee’s Hire if you’re planning to hire tools.
And if you’re looking to purchase home improvement products for your renovation, consider us at Ross’s Discount Home Centre. We offer everything ranging from tiles, kitchen and laundry products, bathroom products, tapware, home appliances, doors and windows, and much more, all at very affordable prices! You’ll find everything that you need under one roof at our store. By purchasing your materials from us, you will reduce your costs significantly.
5. Structural Costs
Structural changes are often one of the biggest hidden costs of renovating, especially for larger projects. When your renovation involves altering walls, expanding rooms, or adding levels, you’ll likely face structural costs that require professional expertise. Structural work demands careful planning, specialised design, ongoing monitoring, and meticulous inspection—none of which are tasks you can or should attempt alone. This is where a qualified structural engineer becomes essential.
Hiring a structural engineer, however, does come at a price. Rates can vary significantly based on the size and complexity of your renovation. In addition to the engineer’s fees, structural changes often come with added construction and material costs, which can increase as your project evolves. To avoid surprises, start by researching local rates for structural engineers and consult one early in the planning process. An experienced engineer will help you accurately budget for structural work, ensuring you’re prepared for these essential costs and keeping your renovation on track.
6. Unexpected Costs & Repairs
One of the most significant hidden costs of renovating often lies in unexpected repairs that surface during the process. Even seasoned renovators can be caught off guard by issues hidden behind walls or under floors. Common culprits include structural repairs, such as wall reinforcements, water damage, or roof repairs. These unexpected costs can easily stretch your budget, sometimes to uncomfortable levels.
From my experience working with countless renovators at Ross’s Discount Home Centre, one essential piece of advice is to plan for the unplanned. Adding a contingency buffer of around 10-15% to your total renovation budget can offer some security against unforeseen expenses. While this buffer often covers standard unexpected repairs, occasionally, larger-scale issues may exceed even a carefully calculated contingency fund. For instance, discovering asbestos, termite damage, or outdated wiring in older homes can lead to costly and mandatory repairs.
By planning for the unexpected and including this contingency, you can better manage the hidden costs of renovating and avoid unwelcome surprises.
7. Site Works
Site works are often one of the hidden costs of renovating that catch homeowners by surprise, especially if your property requires preparatory work before any actual renovations can begin. In Perth, site works can involve everything from clearing vegetation and levelling land to building retaining walls or even hiring heavy machinery like excavators and cranes. These initial stages can quickly add up in cost, especially if your site requires substantial modification to be renovation-ready.
Many of these tasks aren’t just about reshaping land; they also require careful compliance with local council regulations, which may include obtaining permits or arranging inspections. For instance, clearing large trees or altering terrain may require council approval, particularly if it impacts environmental areas or protected zones. This is where planning and research pay off: get familiar with your local council’s regulations early, and don’t overlook associated fees or potential delays.
A tip from my own experience? Get multiple quotes from reputable Perth-based site work companies well ahead of time. And if you’re working with a structural engineer, consult them on how extensive site modifications might impact your overall budget. Being proactive here not only helps you plan for these hidden costs but can also offer peace of mind that your project is built on solid—and legally compliant—ground.
8. The Hidden Costs of Splurging
Splurging is one of the most common ways that renovation budgets go off track, leading to hidden costs that can quickly escalate. I’ve seen countless homeowners in Perth start with a solid budget, only to find themselves splurging on upgrades as the project progresses. It’s easy to get tempted by premium finishes, top-of-the-line appliances, or those “just a little bit better” fixtures that catch your eye. While spending a bit extra on select items can add value, excessive splurging across the board is a fast route to budget blowouts.
The trick is to choose wisely where to invest those extra dollars. Focus on high-impact areas that boost aesthetics or increase value, like quality kitchen cabinets, tiles, doors and windows or bathroom vanities. These visible upgrades can make a lasting impression, enhancing your home’s appeal and resale potential. But be cautious: splurging on every element, from minor fixtures to basic materials, can drain your resources quickly.
To stick to a budget without sacrificing style, establish a clear list of priority items. Allocate extra funds to these key areas and be disciplined about sticking to budget-friendly choices elsewhere. For instance, opting for affordable flooring or mid-range hardware can help you free up funds for those splurge-worthy items. With careful planning, you’ll avoid the trap of unexpected hidden costs and bring your vision to life without breaking the bank.
Also read:
- 6 Home Improvements to Increase the Value of Your Property
- A Checklist to Building or Renovating Your WA Home
- DIY Renovation: 6 Tips to Blitz Your Budget
Conclusion
Home renovations can be transformative but come with a variety of hidden costs that can easily blow a budget out of the water. From relocation expenses to council permits, structural work, and unexpected repairs, these costs often go overlooked until they impact the bottom line. Knowing about these potential expenses upfront is crucial for keeping your renovation project on track and avoiding financial surprises.
By accounting for site preparation, splurging pitfalls, tax implications, and even planning a contingency fund for unexpected repairs, you’ll be better prepared to handle any surprises along the way. It’s all about creating a solid budget that reflects the true cost of renovations, including those often overlooked areas.
And remember, for all your home improvement products in Perth, Ross’s Discount Home Centre offers a wide selection of high-quality, affordable products. Whether it’s kitchen cabinets, tiles, bathroom vanities, or doors and windows, our Guildford showroom and online store provide everything you need to bring your renovation to life—without breaking the bank. Plus, with Perth Metro delivery and a 14-day money-back guarantee, we’ve got you covered from start to finish.
So, if you’re planning a renovation in Perth, make sure you’re prepared for the hidden costs, and visit us at Ross’s to source the essentials at unbeatable prices. Drop by our showroom or explore our range online to start your renovation journey today!
