Cost of house building in NZ?

[Winston001]

I don't understand why building a house is so expensive in New Zealand. In Australia and the USA they seem to be able to build perfectly nice houses for 50%-70% of the cost here.

Why is that and is anyone doing anything about it?

I should add that I'm involved with Habitat for Humanity which is a charity which builds houses for needy families. We'd love to be able to bring building costs down.

[MisterD]

All the builders are working in the Australian sunshine?

[Holy Roller]

I should add that I'm involved with Habitat for Humanity which is a charity which builds houses for needy families. We'd love to be able to bring building costs down.

My brother in law got a home through Habitat and a cousin works for them in Florida. A great scheme for low income earners.

[The Stranger]

I don't understand why building a house is so expensive in New Zealand. In Australia and the USA they seem to be able to build perfectly nice houses for 50%-70% of the cost here.

Why is that and is anyone doing anything about it?

I should add that I'm involved with Habitat for Humanity which is a charity which builds houses for needy families. We'd love to be able to bring building costs down.

Wouldn't we all love to bring building costs down.

At a guess
Natural resources.
Purchasing power.
Economy of scale.

[JimO]

as far as labour costs go ...time is money ..i have found over the last 32 years in the building industry that people are building BIGGER houses with several bathrooms if you want a cheaper house build a smaller house

[Swoop]

The costs are going to go up further in the next 12-18 months. Joinery companies have to comply with new double insulation regulations and so far only aluminium complies. If you want timber........:shit:

[kickingzebra]

Its because all of us builders want to drive porsches... Yeah right, I'm dreaming again.
Lets not forget excessive and prohibitive compliance costs, beaurocratic bungling, and NZers general inability to plan beyond a week in advance with any accuracy when it comes to construction.
Oh, and materials cost a hell of a lot here!

[spookytooth]

hi costs = fletchers own every thing to do with building supplys

[Ocean1]

I suspect a lot of it is self induced. We bleat about poor workmanship and the eventual response is a whole new raft of standards new structures have to comply with. Councils also take a large slice of what they obviously see as a cash cow (and why wouldn’t they, they’ve got an absolute monopoly).

It may be that the building supply industry is itself a monopoly, there’s certainly very few commercial entities at it’s corporate root, (maybe two?). It’s also about to become illegal to build your own home, one of Kiwidom’s defining characteristics is to be disposed of because we really can’t be trusted to do it right.

Soon all new residential buildings in the south island and some of the north will have to have double glazed windows at an extra cost of about $4K. That one we didn't ask for, nor did the market demand it, (we can’t be trusted to make good decisions about how to spend our money), the joint wisdom of the health, welfare and building industries engineered it.

Another factor is that housing in (at least) Aus is structurally simpler. Simple concrete pad, single row brick walls external and internal, basic steel roof trusses, high volume pre-fab joinery, paint and move in. They don't have a lot of earthquakes though...

Not to worry, when the revolution comes all the parasites will be up agin’ the wall with the remnants of administrative Nanyhood and we’ll be free to knock up our own shacks like our fathers did before us.

[BIGBOSSMAN]

Yes, it's become horrendous. I sold my home a couple of months ago and bought a 566m section overlooking the city in Massey (Auck). I'm looking at m2 prices of $1800 - $2300 to build in B&T, 2 bathrooms, etc etc (200m2 house). Nothing esoteric in terms of materials (no granite kitchen top or Italian tiles), but 5 years ago it would have cost $1300 - $1800 per m2 for the same thing. I haven't noticed my salary increasing by the same amount!:gob:

[Winston001]

Builders earn more in Oz and the USA - I've met carpenters who have moved to those countries for that reason. Our wages are still low despite the lack of builders, plumbers etc. Catching up maybe.

I don't think resource consents are the problem. Councils fall over themselves to be helpful because they like the idea of more ratepayers. Getting a subdivision approved in the first place is the main hurdle.

Certainly our tighter building rules are making it more expensive but it has been more expensive for a long time. I remember seeing packages on the Gold Coast in 1995 for 4 bedroom houses, including land, for A$82,000. At the same time here it was costing about NZ$200,000.

I'm thinking that our double wall (cavity wall) construction must double the construction work. In Oz it looks like they can build single brick walls with no extra internal wall, just a direct lining - or just bare bricks - as Ocean says. I guess our colder moist climate is a problem.Really I'm interested in what the answer is to building affordable homes and wonder if we've adopted a building style which is out of date and unnecessarily expensive.

[Winston001]

And now it is time to say a big thankyou to you guys and give credit where it is due.

I posted the same question on 3 other forums which I frequent.

The computer forum had 2 replies who wanted to argue over the comparison with other places rather than look at reasons and solutions in NZ.

The discussion forum had 3 replies and blamed resource management.

The investors forum had 2 reasoned replies.

But here on Kiwibiker there were 9 replies in the same time and all of them interesting and worth reading. :first:

So what is it about riding a bike.......... :rockon:

[Ocean1]

So what is it about riding a bike.......... :rockon:

Opinionated pedantry?

[shafty]

I agree the cost is stupid, - and monopolies like Gib get right up my nose.

To make things worse, we ride thru 1000's of acres of forest and yet it costs so much for timber.

My current thinking is that I have to pay for about 6 bludgers/bureaucrats before I eat.

[geoffm]

Seen the price of a building permit these days? Damn near 10% of the house goes to the council for red tape and avoiding their obligations.
NZ hasa a lot of monopolies/ duopolies in the supply chain, combined with (mostly foriegn) owners gouging means higher prices.
If I was young, single and didn't have a house, I would not be living in NZ. Oz gives better value for money in a lot of areas.
G

[sAsLEX]

Its because all of us builders want to drive porsches... Yeah right, I'm dreaming again.


Plumber in Auckland has a Bently as his work van......

[JimO]

Plumber in Auckland has a Bently as his work van......

he made his money in britan.........regarding consents it takes 8 weeks to get a consent in Dunedin at the moment,(ODT yesterday) i was talking to a builder yesterday who said after waiting 7 weeks he rang the council about a fire damaged house he was reinstating to be told that his consent will be through next week he said thats good but im ready for the first inspection now

[Winston001]

...regarding consents it takes 8 weeks to get a consent in Dunedin at the moment,(ODT yesterday) i was talking to a builder yesterday who said after waiting 7 weeks he rang the council about a fire damaged house he was reinstating to be told that his consent will be through next week he said thats good but im ready for the first inspection now

Yeah councils are up against it at the moment. New building regs and not enough inspectors. I understand that a lot have retired in the past 5 years because of the leaky homes stress and demands from homeowners. It just ain't a popular job.

Other inspectors have left to go building themselves. Plenty of work, not dealing with a hundred angry/frustrated builders etc etc.

[peasea]

Its because all of us builders want to drive porsches... Yeah right, I'm dreaming again.
Lets not forget excessive and prohibitive compliance costs, beaurocratic bungling, and NZers general inability to plan beyond a week in advance with any accuracy when it comes to construction.
Oh, and materials cost a hell of a lot here!


Bravo! Resource consents, council fees, permit costs, Carter Holt Harvey being greedy bastards, the list goes on. You can build houses for reasonable money but you don't get much more than a 3brm box. Then you have to put it somewhere and if you're anywhere between the Bombay Hills and the Brynderwyns you're very likely to get stiched up for a poket-handkerchief sized section.

I'm getting out of Auckland altogether and I'm advising my children to do the same.

[Kwaka14]

hi costs = fletchers own every thing to do with building supplys

Actually it's more like CHH now....

[xwhatsit]

While I lived in Brisbane the family built a house. Not ourselves, mind -- hired somebody to do it.

Anyhow, it was dirt cheap. Ridiculously so. The reason being as has been stated already; just pour a big concrete slab, stick some prefab wooden structure up, then the bricklayers come in and lay down a single layer of bricks on the outside. Far more simple over there.

The biggest factor, though, I think is economies of scale and competition. Brisbane, and many other parts of Australia, is undergoing rapid expansion and has been for years. Subdivisions seem to go up overnight. As a result, you've got building companies by the bucket-load, and stiff competition between them. In NZ (well Auckland at least) nobody builds much, they tend to buy an existing house. Sometimes people hire builders to do work on existing houses.

So you've got a much smaller pool of builders. That's self-explanatory, don't need to iterate the higher costs you get in a situation like that.

[spookytooth]

Actually it's more like CHH now.... Ok i will start hating them instead thanks :P

[SPman]

While I lived in Brisbane the family built a house. Not ourselves, mind -- hired somebody to do it.

Anyhow, it was dirt cheap. Ridiculously so. The reason being as has been stated already; just pour a big concrete slab, stick some prefab wooden structure up, then the bricklayers come in and lay down a single layer of bricks on the outside. Far more simple over there.

The biggest factor, though, I think is economies of scale and competition. Brisbane, and many other parts of Australia, is undergoing rapid expansion and has been for years. Subdivisions seem to go up overnight. As a result, you've got building companies by the bucket-load, and stiff competition between them. In NZ (well Auckland at least) nobody builds much, they tend to buy an existing house. Sometimes people hire builders to do work on existing houses.

So you've got a much smaller pool of builders. That's self-explanatory, don't need to iterate the higher costs you get in a situation like that.

In Perth - lots of building companies, double brick construction on a concrete slab on a sand pad!, - they make bricks in Perth (Midland),so its almost the last bastion of this style of construction. About half the houses have steel roof trusses and any internal framing is usually steel. Cost's are around $1300/m2 for a 180m2 house of "good" quality. There is a major use of specialist subtrades over here.
As an ex NZ building inspector, just walking around, a lot of the houses are as crappily built as in NZ and, if they ever have another earthquake down on the plains, I wouldn't want to be in any of the houses. There are virtually no inspections - the builders have to be licensed to do work over $12,000 in value, unless you are building your own home, in which case they have what they call an "owner/builders license. A permit is required for everything though - in NZ, there are things you can build without a permit. I think the theory for no inspections is, that if you are an owner builder, it's your house and you wouldnt want it to fall down, and the registered builders can be prosecuted and possibly lose their licenses, if they build a shoddy house!
Builders generally earn more over here.
NZ is stymied by exorbitant pricing of materials under the excuse of "small market" It has been possible to by NZ sourced timber over here for 1/2 to 2/3rds the price it sells in NZ, for years. Plasterboard is kept artificially high to protect Winstones Gib board - importers have to pay a large duty to bring it in, which sees the cost at twice what it is in Aus.
CHH and co have got the consumers over a barrel.
Compliance costs have become ludicrous, but won't get any less, because the councils are required to implement the laws set down by the Gov. - and it costs! Auckland City inspection division just breaks even - the only dept that comes near! Land costs are even worse, but the same situation has developed over here - unless you want to live 100k out of town, like I do.

[peasea]

In Perth - lots of building companies, double brick construction on a concrete slab on a sand pad!, - they make bricks in Perth (Midland),so its almost the last bastion of this style of construction. About half the houses have steel roof trusses and any internal framing is usually steel. Cost's are around $1300/m2 for a 180m2 house of "good" quality. There is a major use of specialist subtrades over here.
As an ex NZ building inspector, just walking around, a lot of the houses are as crappily built as in NZ and, if they ever have another earthquake down on the plains, I wouldn't want to be in any of the houses. There are virtually no inspections - the builders have to be licensed to do work over $12,000 in value, unless you are building your own home, in which case they have what they call an "owner/builders license. A permit is required for everything though - in NZ, there are things you can build without a permit. I think the theory for no inspections is, that if you are an owner builder, it's your house and you wouldnt want it to fall down, and the registered builders can be prosecuted and possibly lose their licenses, if they build a shoddy house!
Builders generally earn more over here.
NZ is stymied by exorbitant pricing of materials under the excuse of "small market" It has been possible to by NZ sourced timber over here for 1/2 to 2/3rds the price it sells in NZ, for years. Plasterboard is kept artificially high to protect Winstones Gib board - importers have to pay a large duty to bring it in, which sees the cost at twice what it is in Aus.
CHH and co have got the consumers over a barrel.
Compliance costs have become ludicrous, but won't get any less, because the councils are required to implement the laws set down by the Gov. - and it costs! Auckland City inspection division just breaks even - the only dept that comes near! Land costs are even worse, but the same situation has developed over here - unless you want to live 100k out of town, like I do.

Thanks for insight into the Ozzie scene, thought I was right about CHH, kiwis stitching up kiwis really sucks.