Site costs vary from state to state, but they are usually associated with excavation work on a block of land and can add between $5000 and $20,000 or more to the price of a house and land package. Industry sources say site costs on average are about “$12,500 over and above the listed price”.

Gil King, Housing Industry Association Victorian executive director says it pays to be fully familiar with these costs before committing to buying a new home and land pairing.

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Mr King says while most of these so-called site costs may be covered in the standard building contract in each state, but others may not be.

“There are many things that can be classified as ‘site costs’ when building a new home and while the builder will often absorb many of these in their standard contracts, just because they are so constant,” he says. “Some however are so variable that they need to be dealt with separately. Depending on the site conditions and the circumstances they can amount to a substantial amount over and above the contract price.”

Some examples of site costs

(i) Confirmation of site boundaries by a surveyor.
(ii) Earthworks because of the slope of the block or due to removal of rocks.
(iii) Tree removal.
(iv) The sue of a concrete pump.

The HIA chief says services such as bin hire, site signage, temporary fencing and crossover fees are examples of site costs that, unless “exceptionally unusual circumstances exist”, are included in the contract price.

But he adds examples of unforeseen circumstances can include tree removal, the use of a concrete pump on a difficult site as well as re-establishing or confirming the site boundaries by a land surveyor. “This (the latter) is required when there is some uncertainty about the exact title boundary and is very common on smaller, inner-suburban blocks,” Mr King says.

“Some trees can remain on an established block, however even when the tree is not in the building envelope they may need to be removed due to their root system.

“Stormwater drainage requirements are often very clear, however specific site conditions (such as rocks) may necessitate expensive variations. Earthworks is a common additional requirement if excavation is needed.

“While geotechnical reports are required to be provided by the builder before they enter the contract, sometimes even the best reports cannot identify rocks and variable soil conditions.”

The HIA spokesman says prospective homebuyers hoping to avoid unexpected costs should talk about them with their builder and “seek their advice at the earliest possible opportunity”.

“Sometimes just by going out on site before signing on the dotted line, a land owner can get a feel for some of these issues,” Mr King says. “If in doubt, seek expert advice.”

This story was brought to you by The New Daily using data and other information from its real estate content partner, realestateVIEW.com.au