How Much Does it Cost to Buy a Dental Practice?

Purchasing a dental practice is a significant investment that requires careful consideration and planning. Whether you’re a seasoned dentist looking to expand your footprint or a new practitioner eager to establish your own clinic, understanding the costs involved is crucial. 

The price of buying a dental practice can vary widely based on several factors, including the size of the practice, its location, the types of services offered, and whether the purchase includes real estate. 

In this blog, Palladium Business Broking delves into the various cost components, from acquiring the business itself to potentially buying the property, providing you with a comprehensive guide to help you make an informed decision.

Keep reading to discover the answers to the question “How much does a dental practice cost?”

Buying the Business Only vs. Buying a Dental Practice with Real Estate

When evaluating the purchase of a dental practice, it’s important to understand the key distinctions between buying the business alone and buying a practice that includes real estate (freehold). Here are the primary differences:

Aspect	Buying the Dental Practice (Business) Only	Buying a Dental Practice with Real Estate (Freehold)
Assets Included	Operational Assets: Patient lists, dental equipment, supplies, goodwill, brand reputation, staff contracts, and potentially some intellectual property. Excludes Real Estate: The physical property is not included; you will likely lease the space.	Operational and Real Estate Assets: Includes all the operational assets of the practice as well as the physical property (building and land). Property Ownership: You own the premises, giving you full control over the space.
Lease Agreement	Lease Terms: Negotiate with the property owner. Consider lease duration, rent amount, renewal options, and property use clauses. Flexibility: Easier to relocate if lease terms become unfavourable or if you wish to expand/move.	N/A
Capital Requirements	Lower Initial Investment: Generally requires less upfront capital compared to purchasing a freehold dental practice with real estate. Operational Focus: Allows concentration of financial resources on growing the practice rather than managing property.	Higher Initial Investment: Requires a larger upfront capital outlay due to the cost of real estate in addition to the business. Equity and Appreciation: Build equity in the property and benefit from potential real estate appreciation over time.
Risk and Responsibility	Less Responsibility: No need to worry about property maintenance, taxes, or insurance beyond what is stipulated in the lease agreement. Lease Risks: Potential risks include rent increases or lease termination by the landlord.	Property Management: Responsible for property maintenance, taxes, insurance, and other property-related expenses. Market Risks: Exposure to real estate market fluctuations, which can affect property value and financial stability.
Control and Stability	Flexibility: Easier to relocate if the lease terms become unfavourable or if you wish to expand or move to a different area.	Greater Control: Full control over renovations, expansions, and property use without needing landlord approval. Long-Term Stability: Eliminates the risk of lease termination or significant rent increases, providing long-term security for your practice location.

How Much Does it Cost to Buy a Dental Practice in Australia? 

The prices for buying a dental practice, whether just the business or including real estate, can vary widely based on numerous factors such as location, size, profitability, the number of dentists, the types of dentistry they do, machines, and the specific assets included. Below is a general overview of the potential price ranges in Australia for small, medium, and large dental practices, along with the factors that can influence these prices.

Buying a Dental Practice (Business) Only:

Small Dental Practice (Business Only)

Aspect	Details
How much does a dental practice clinic cost (small)?	AUD 200,000 – AUD 500,000
Number of Dentists	Typically 1-2 dentists
Types of Dentistry	General dentistry, basic preventive and restorative services
Equipment	Basic dental chairs, X-ray machines, sterilization equipment, and standard dental tools
Patient Base	Smaller patient list, often in a localized area
Revenue	Lower annual revenue, reflective of a smaller operation

Medium Dental Practice (Business Only)

Aspect	Details
How much does a dental practice cost (medium)?	AUD 500,000 – AUD 1,500,000
Number of Dentists	2-4 dentists
Types of Dentistry	General dentistry with some specialized services like orthodontics, endodontics, or cosmetic dentistry
Equipment	More advanced and additional equipment, such as digital imaging systems, CAD/CAM technology, and multiple dental chairs
Patient Base	Moderate patient list with a broader reach
Revenue	Higher annual revenue, indicating a well-established practice

Large Dental Practice (Business Only)

Aspect	Details
How much does a dental clinic cost (large)?	AUD 1,500,000 – AUD 5,000,000+
Number of Dentists	4+ dentists, potentially including specialists
Types of Dentistry	Comprehensive services including advanced specialties and possibly surgical procedures
Equipment	State-of-the-art equipment, multiple operatories, advanced diagnostic tools, and possibly an in-house lab
Patient Base	Large and diverse patient list, possibly with multiple locations
Revenue	High annual revenue, reflecting a large and thriving practice

How Much Does a Dental Practice Cost with Real Estate (Freehold)?

Small Dental Practice with Real Estate

Aspect	Real Estate Factors
Price Range	AUD 300,000 – AUD 1,000,000+
Real Estate Value	Cost of the property, which can vary significantly based on location, size, and condition of the building
Number of Dentists	Typically 1-2 dentists
Types of Dentistry	General dentistry, basic preventive and restorative services
Equipment	Basic dental chairs, X-ray machines, sterilization equipment, and standard dental tools
Patient Base	Smaller patient list, often in a localized area
Revenue	Lower annual revenue, reflective of a smaller operation

Medium Dental Practice with Real Estate

Aspect	Real Estate Factors
Price Range	AUD 1,000,000 – AUD 2,000,000+
Real Estate Value	Larger or more strategically located properties will increase the price
Number of Dentists	2-4 dentists
Types of Dentistry	General dentistry with some specialized services like orthodontics, endodontics, or cosmetic dentistry
Equipment	More advanced and additional equipment, such as digital imaging systems, CAD/CAM technology, and multiple dental chairs
Patient Base	Moderate patient list with a broader reach
Revenue	Higher annual revenue, indicating a well-established practice

Large Dental Practice with Real Estate

Aspect	Real Estate Factors
Price Range	AUD 2,000,000+
Real Estate Value	Large commercial properties, potentially with multiple floors or additional facilities
Number of Dentists	4+ dentists, potentially including specialists
Types of Dentistry	Comprehensive services including advanced specialties and possibly surgical procedures
Equipment	State-of-the-art equipment, multiple operatories, advanced diagnostic tools, and possibly an in-house lab
Patient Base	Large and diverse patient list, possibly with multiple locations
Revenue	High annual revenue, reflecting a large and thriving practice

Additional Considerations: How Much Does a Dental Practice Cost? 

• Market Conditions: Real estate and business market conditions can significantly impact prices.
• Practice Performance: Historical financial performance and growth potential of the practice.

Find the Right Dental Practice with Palladium Business Broking

That wraps up our guide on “How much does it cost to buy a dental practice?”

Ultimately, prices can vary greatly based on specific circumstances, and it’s essential to conduct thorough due diligence, including financial analysis and market research. Consulting with professionals such as dental practice brokers, financial advisors, and real estate experts is highly recommended to get accurate and tailored advice.

Palladium Business Broking specialises in healthcare business broking. We are experts helping in appraising, listing, sourcing and selling Medical and Dental practices in an efficient, discreet, pleasant and professional environment.

View our listings of dental practices for sale in Melbourne and Victoria. Contact us today for more information. ‘

Take a look at our other guides for more helpful information:

• Buying an Established Dental Practice Vs Starting Your Own Dental Clinic
• Key Considerations When Buying a Dental Practice
• How to Sell a Dental Practice