Building New vs Renovating Old House in Sri Lanka (2025 Cost)

"Ideally, I'd find an old house on good land and fix it up."

It sounds romantic (and cheaper). But in Sri Lanka, renovation often opens a Pandora's box of termites, damp walls, and bad plumbing. Sometimes, the bulldozer is the cheaper option.

Here is the 2025 cost-benefit analysis.

The Cost of Renovation
The Cost of Building New
The "Hidden Killers" in Old Houses
When to Renovate (The Green Light)
When to Demolish (The Red Light)

1. The Cost of Renovation

Renovation costs are unpredictable. A budget of Rs. 2 Million often becomes Rs. 4 Million.

Typical Rates (2025)

Cosmetic (Paint/Tile): Rs. 1,500 - 2,500 per sq ft
Structural (Walls/Roof): Rs. 3,500 - 5,000 per sq ft
Full Gut Renovation: Rs. 6,000+ per sq ft

Note: Labor for renovation is expensive because it involves careful demolition and fitting new to old.

2. The Cost of Building New

Building new is predictable. You have a BOQ (Bill of Quantities) and a contract.

Typical Rates (2025)

Standard Finish: Rs. 9,000 - 11,000 per sq ft
Luxury Finish: Rs. 13,000 - 18,000 per sq ft

Demolition Cost: Don't forget this! Demolishing an old single-story house costs Rs. 300,000 - 500,000. (Often you can trade the debris/old windows to offset this cost).

3. The "Hidden Killers" in Old Houses

If you buy an old house (20+ years), check for these. They break budgets.

Dampness (Rising Damp): Look for bubbling paint near the floor. Sri Lankan houses rarely had damp-proof courses (DPC) before 2000. Fix: Very expensive (chemical injection needed).
Termites: Look for mud trails. If they are in the roof timber, the whole roof needs replacing. Fix: Rs. 1-2 Million for a new roof.
Plumbing/Wiring: Old GI pipes rust. Old wires are fire hazards. Fix: 100% replacement required.
Layout: Old houses have small windows and dark rooms. Opening them up requires expensive structural beams.

4. When to Renovate (The Green Light) ✅

Good Bones: The structure (columns/beams) is solid concrete, not load-bearing brick cracks.
Heritage Value: It has archways, courtyards, or antique value that can't be replicated.
Minor Changes: You mostly need new bathrooms, kitchen, and paint.
Budget: You have 50-60% of the cost of a new build.

5. When to Demolish (The Red Light) 🛑

Foundation Failure: Major cracks in walls (>5mm wide).
Low Ceiling: You can't raise a concrete slab. Low ceilings feel oppressive.
Asbestos: Old roofs often use asbestos sheets. Removal is hazardous.
Layout Issues: If you need to move bathrooms and stairs, just build new. It's cheaper.

Verdict

If the renovation cost > 60% of the new build cost, just DEMOLISH. You will get a brand new asset with a 50-year lifespan and higher resale value, rather than a patched-up asset with a 15-year lifespan.

Calculating...

New Build (2000 sq ft): ~Rs. 20 Million
Renovation Quote: ~Rs. 12 Million
Decision: Borderline. If you can get it done for Rs. 8M, renovate. If Rs. 12M+, build new.

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