New Build vs Renovation: Cost Comparison Guide

Back to Knowledge Hub

The Build or Renovate Decision

Whether to build a new home from scratch or renovate an existing property is one of the biggest decisions any property owner or developer will face. It affects your budget, your timeline, the end result you can achieve, and the level of disruption you will experience along the way. There is no universal right answer. The best choice depends entirely on your circumstances, your site, your goals and your finances.

Both options have significant advantages and notable drawbacks. A new build offers complete design freedom and modern performance standards, but comes with higher upfront costs and a longer planning process. A renovation can preserve character and make use of existing infrastructure, but carries greater uncertainty and the ever-present risk of hidden problems behind walls and under floors.

In this guide, we break down the typical costs, timelines, and practical considerations for both approaches to help you make an informed decision. All figures are based on current UK market conditions and reflect the range of projects we work on at First4Estimating.

New Build Costs Overview

Building a new home from the ground up involves every element of construction: site preparation, foundations, substructure, superstructure, roof, external envelope, internal fit-out, mechanical and electrical installations, external works and landscaping. The total cost depends on the size of the property, the quality of the specification, the complexity of the design, the site conditions and the region of the UK.

At the lower end of the range, you would expect a straightforward design with standard materials, a simple rectangular footprint and a conventional specification. At the upper end, the figure reflects higher-quality finishes, more complex architectural forms, premium materials such as natural stone or zinc cladding, underfloor heating throughout, and features such as large-format glazing or green roofs. In London and the South East, costs tend to sit towards the higher end of the scale, while projects in the Midlands, North of England, Wales and Scotland are generally more affordable.

The timeline for a new build is typically 12-18 months from breaking ground to completion, though this can extend significantly for larger or more complex projects. Planning permission can add 8-12 weeks on a straightforward application, or considerably longer if the site is sensitive or the design requires negotiation with the local authority. It is important to factor in the full timeline, including design development and approvals, when planning your budget and expectations.

Renovation Costs Overview

Renovation costs are inherently more variable than new build costs because every existing building is different. The condition of the structure, the extent of the work required, the age of the property, the accessibility of the site and the presence of any hazardous materials such as asbestos all influence the final cost. A light cosmetic refurbishment will cost far less per square metre than a comprehensive structural renovation that involves stripping the building back to its shell.

As a broad guide, renovation costs in the UK typically range from 800 to 2,500 or more per square metre. A basic refurbishment involving new kitchens, bathrooms, decoration and flooring without significant structural work might sit at the lower end. A full renovation that includes structural alterations, new windows, complete rewiring, replumbing, new heating systems, insulation upgrades and high-quality finishes will be towards the upper end or beyond.

One of the key challenges with renovation projects is cost certainty. Until you open up the building, you cannot be entirely sure what you will find. Timber decay, structural movement, outdated or dangerous wiring, inadequate foundations and damp problems are all common discoveries once work begins. Each of these adds cost and time to the project. For this reason, renovation budgets should always include a generous contingency allowance, typically 10-15%, to cover the unexpected.

Side-by-Side Comparison

When comparing new builds and renovations, it helps to assess them across several key criteria. Each approach has distinct strengths, and the right choice will depend on which factors matter most to your particular project.

• Cost certainty: New builds generally offer greater cost certainty because the scope of work is fully defined from the outset. Renovations carry more risk of unforeseen costs due to hidden conditions in the existing structure.
• Timeline: A new build typically takes 12-18 months on site. Renovations can be faster for modest projects but may take equally long or longer for comprehensive schemes, especially when complications arise.
• Planning permission: Renovations often benefit from existing use rights and may not require planning permission for internal works, though extensions and significant external changes usually do. New builds always require planning permission, which can be a lengthy process depending on the site.
• Sustainability: Renovating an existing building reuses embodied carbon in the existing structure, which is a significant environmental benefit. However, new builds can achieve higher energy performance standards more easily and cost-effectively through modern construction methods and materials.
• VAT implications: New builds in the UK are zero-rated for VAT, which means you do not pay VAT on the construction costs. This is a significant financial advantage. Most renovation work is subject to VAT at 20%, though some qualifying works to residential properties may attract a reduced rate of 5%.
• Design freedom: A new build gives you complete control over the layout, orientation, room sizes and features. A renovation requires you to work within the constraints of the existing structure, though creative design can often achieve excellent results.

Pros and Cons of Each Approach

Understanding the advantages and disadvantages of each option in detail will help you weigh up which approach best suits your project goals, budget and risk appetite.

New Build Advantages

• Modern building standards: A new home is built to current Building Regulations, delivering excellent thermal performance, airtightness and energy efficiency from day one.
• Structural warranty: New builds typically come with a 10-year structural warranty, providing peace of mind and making the property easier to mortgage.
• Energy efficiency: Modern insulation, glazing, heating systems and ventilation mean lower running costs and a smaller carbon footprint compared to most older properties.
• Design freedom: You can design the home exactly to your needs, optimising room layouts, storage, natural light and outdoor spaces without compromise.
• Lower maintenance: Everything is new, so there should be minimal maintenance requirements for the first several years.
• Zero-rated VAT: No VAT on construction costs represents a saving of up to 20% compared to equivalent renovation work.

New Build Disadvantages

• Higher upfront cost: The total construction cost per square metre is generally higher than renovation, even before land purchase is factored in.
• Planning can be slow: Obtaining planning permission for a new dwelling can be a protracted process, particularly in rural areas, green belt locations or conservation areas.
• Land availability: Finding a suitable plot at an affordable price can be extremely challenging, especially in popular areas.
• Longer timeline: From initial design through planning, procurement and construction, a new build project typically takes 18-24 months or more from start to finish.

Renovation Advantages

• Character and charm: Older properties often have architectural features, proportions and a sense of history that are impossible to replicate in a new build.
• Existing infrastructure: The property already has connections to utilities, an access road, boundary treatments and potentially mature gardens, all of which save cost and time.
• Potentially lower cost: For projects that do not require wholesale structural changes, renovation can be more cost-effective than building from scratch.
• Established location: Renovation properties are often in established residential areas with mature streetscapes, local amenities and good transport links.
• Environmental benefit: Reusing the existing structure avoids the significant carbon emissions associated with demolition and new construction.

Renovation Disadvantages

• Hidden problems: Structural defects, damp, asbestos, outdated wiring and plumbing, and inadequate foundations are all common discoveries that add cost and delay.
• Design compromises: You must work within the constraints of the existing building, which may limit room sizes, ceiling heights, window positions and layout options.
• Lower energy performance: Bringing an older building up to modern energy standards can be expensive and technically challenging, particularly with solid walls and single-glazed windows.
• Higher ongoing maintenance: Older buildings require more regular maintenance and are more likely to need repairs to roofs, gutters, external walls and windows.
• VAT liability: Most renovation work attracts VAT at 20%, increasing costs compared to the zero-rated position for new builds.

Which Is Right for Your Project?

The decision between building new and renovating comes down to a handful of key factors that are specific to your situation. There is no one-size-fits-all answer, but working through the following considerations will help you reach the right conclusion.

Budget: If your total budget is fixed, work backwards from the numbers. Factor in land or property purchase price, professional fees, construction costs and a contingency. A renovation may give you more square footage for less money, but only if the existing building is in reasonable condition. A new build will cost more per square metre but offers greater cost certainty.

Location: In areas where building plots are scarce or prohibitively expensive, renovation may be the only realistic option. Conversely, if you have access to affordable land, a new build allows you to start with a blank canvas. Property developers often weigh up both options for each site to determine the best return on investment.

Timeline: If you need to move in quickly, a light renovation can be completed faster than a new build. However, a major renovation can take just as long, or longer, once unforeseen issues are factored in. Self builders should plan their timeline carefully regardless of which route they choose.

End use: Consider what you want the finished property to achieve. If energy efficiency, low running costs and a modern layout are priorities, a new build is likely the better option. If you value period character, established gardens and a particular neighbourhood, renovation may be the more rewarding path.

Getting Expert Advice

Whether you are leaning towards a new build or a renovation, the single most valuable step you can take before committing is to obtain a professional estimate. A detailed, independent cost assessment gives you clarity on what each option will actually cost, allowing you to compare like for like and make a decision based on facts rather than guesswork.

At First4Estimating, we prepare estimates for both new build and renovation projects across the UK. Our qualified Quantity Surveyors will review your plans, measure the works, apply current market rates and produce a comprehensive cost breakdown that you can rely on. We work with property developers, self builders, builders and architects to provide the cost information they need at every stage of the project.

Our estimating services cover everything from early-stage feasibility budgets through to full tender documentation. If you would like to see examples of the projects we have worked on, visit our projects page. When you are ready to discuss your project, get in touch and we will provide a quotation for preparing your estimate, with no obligation and a fast turnaround.