The cost per unit (HPP) is everything it takes to produce one house ready to sell, not only its building cost. Developers who count only the building are often surprised: land, infrastructure, permits and interest can be more than half the cost.
- Land Rp60 m
- Site preparation and infrastructure Rp20 m
- Building Rp126 m
- Permits and title Rp10 m
- Marketing and admin Rp6 m
- Construction loan interest Rp8 m
Example: 40 type 36/72 units
| Component | Calculation | Per unit |
|---|---|---|
| Land | 4,000 m2 × Rp600,000 = Rp2.4 bn; saleable plots 40 × 72 = 2,880 m2 (72%) | Rp60 m |
| Site preparation and infrastructure | Fill, roads, drains, power and water networks Rp800 m ÷ 40 | Rp20 m |
| Building | 36 m2 × Rp3.5 m per m2 (from the unit budget) | Rp126 m |
| Permits and title | Building approval, title splitting and others Rp400 m ÷ 40 | Rp10 m |
| Marketing and admin | Brochures, show house, commissions, administration | Rp6 m |
| Construction loan interest | Interest during building and sales | Rp8 m |
| Cost per unit | Rp230 m |
At a selling price of Rp290 m, the gross margin is Rp60 m, or 20.7% of the price. Sales taxes are worked out separately. The figures here are fictional; use your own land price, unit budget and real costs.
What is often missed
- Saleable area: not all land can be sold. Roads, drains and public facilities reduce plot area, so land cost per plot is higher than the land price per m2.
- Corner units and units with extra land: work out their extra separately.
- The show house and slow-selling units carry interest for longer.
- Costs after handover: warranty repairs and estate upkeep until it is handed to the local government.
Steps
- Gather the whole project’s costs by component: land, site preparation, infrastructure, building per type, permits, marketing, interest.
- Spread shared costs (land, infrastructure, permits) over the units, by plot area if types differ.
- Add each type’s building cost from its unit budget.
- Compare with each type’s selling price to see the margin.
- Update the cost whenever actual costs change, since units sold later can have a different cost.
Common mistakes
- Counting only the building cost.
- Dividing land cost by total land area instead of saleable plot area.
- Booking permits and interest as office costs, so the margin per unit looks larger.
- Not updating the cost after material prices rise.
The full guide is in How to create a construction finance report in Google Sheets. It has a free template (Excel or Google Sheets) and a checker that reads your own workbook.
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Common questions
What is the cost per house (HPP)?
Everything it takes to produce one house ready to sell, including land, infrastructure, building, permits, marketing and interest.
How is land cost shared between units?
Divide total land cost by the saleable plot area, then multiply by each unit’s plot area.
What is a healthy developer margin?
It depends on location and segment. What matters is working it out from the full cost, not the building cost alone.