Passive house on a budget: What are the costs of a passive house?

by | Jul 27, 2022 | Budget

It is a common misperception that passive homes are generally more expensive to build than non-passive houses. Just because you choose to build an energy-efficient, well-insulated and healthy home, does not necessarily mean that you’ll have to dig deeper into your bank account.

Building a home is always a highly individual undertaking, so there is no way to generalise the costs for each building project. How much money you will have to pay rather relies on many different factors, such as the size of your home, the complexity of the design, the actual building site, the materials used, and your choice of builder.

So, to know how much your passive house is going to cost, you have to understand where the majority of the cost is actually coming from. In this article, we will explore:

  • How much a house costs on average per square metre
  • The cost for passive house components
  • How to save money while building a passive house
  • How to save money after building a passive house
  • Why building a passive house is a good investment


According to the Australian Bureau of Statistics (ABS), the average cost for building a home was $1393.55 per m² as of December 2019. However, this number varies greatly depending on where you wish to build.

costs of passive houses 2


Based on our experience, an average sized custom designed passive home will cost around $3,000 per m², therefore falling into the average range of prices for home construction.


Passive designs use high-quality components throughout the build to maximise the energy efficiency of the home, and since the Australian passive house movement is only starting, you might face some higher price tags for certain materials that still have to be ordered from Europe.

However, the Australian government has started to support the push for more energy-efficient housing and the more manufacturers providing passive design components such as double- or triple-glazed windows, the cheaper it will get in the future.

On top of that, many of the up-front costs for components such as windows, insulation and ventilation systems will be canceled out by the incredible reduction in running costs, but we’ll get to that in a bit.


There are many things you can save money on during your build without having to dial back on quality or comfort of your new home.

First of all, passive houses are all about efficiency, and that is not just limited to optimising heating and cooling. Most passive house designs have a thought out floor plan to maximise the space you can actually use while minimising unnecessary nooks and areas.

Secondly, this efficient design process using certified passive house construction components gives you a lot of planning security. We collaborate with independent certified assessors, who are able to accurately predict the performance of your house and tell us exactly what we will need to build the house.

Finally, at OUTLIER, we have decided to go the extra mile and provide your builders with the utmost information possible to make sure you get exactly what you paid for – and don’t have any unwanted surprises waiting for you at the end.


While we can’t definitively say that your new passive house will be more or less pricey than a non-passive built, what we can say is that you will 100% save money in regards to your overall running costs. Let us explain.

Based on the average energy cost (electricity, gas) in Victoria, a house with a 2-star energy rating roughly spends $7,330* a year on operational cost. If you opt for a 7-star energy rating, your cost goes down by over 70%.

To take it one step further, a 10-star energy rating passive home basically won’t cost you anything in heating or cooling, leaving you with an average annual bill of only $23.71.

Amazing, right?

*OUTLIER energy calculations


As we have seen before, the potential increase in costs due to high-quality materials such as double- or triple-glazed windows and proper insulation will cancel out quickly due to the high reduction of energy costs for heating and cooling. So, from that perspective alone, it is definitely worth building a passive house.

On top of that, the government push to promote more energy-efficient building and the introduction of a minimum six-star energy rating for new builds paints a clear picture on where the Australian housing market is going in the next few years.

So, be one of the first adapters to better quality, more efficient and highly comfortable living and invest in your passive future now. We are here to help.

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