Build Cost Plateau.

The Australian Bureau of Statistics (ABS) has released its Q4 2024 data, showing a slight downward shift in building costs for the first time since early 2020. Yep, on the graph below you’ll see that it’s that teeny-tiny little dip at the top of the graph.

Is it time to pop the champagne and plan for a massive dip in build cost? Probably not. But it is a good sign that the costs are steadying.

You’ll note on the graph that between 2016 and 2020, costs were consistent. From early 2016 to mid-2020, costs raised on average 0.5% per quarter, aligned mostly with inflation. In this period, we experienced greater pricing certainty and project control.

Then boom!

We hit mid-2020 and prices soar—fast! We arrive today with build costs approximately 45% higher than back then. But I reckon we are nearing what I anticipate will be our new normal—A period more similar to our 2016-2020 era where there was greater certainty—albeit at a much higher rate.

The greatest challenge we now face is preparing hopeful homeowners looking to build or renovate about where construction costs are really at. Ultimately, homeowners know prices have increased—but their expectation of cost has always been deludedly optimistic, and the gap between expectation and reality is bigger than ever.

The key now is early education and guidance. Cost needn’t be feared, but they do need to be known and factored. Let’s get educated together so we can be a needed guide for our clients.

PS: Want to stay ahead? Check out the Project Forecast Calculator on my website to see how past projects compare to today’s costs. And don’t miss my Cost by Quartersession tomorrow—Thursday, 13th Feb @ 3pm. Grab your spot now!