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More skilled workers needed to lower NZ's high house building costs, expert says

New Zealand needs more skilled workers and a more streamlined system for construction to lower the high cost of building houses, according to a real estate expert.

The cost of new builds is stifling the country's ability to build much-needed housing, TVNZ1's Seven Sharp reported.

Construction costs in the main centres rose by 30 per cent in the last decade and the price of land went up by half during the same period.

Building costs in New Zealand are now around $2000 per square metre while a comparable house in Australia can be half that.

Some blame local councils and the consenting process, as well as post-earthquake seismic requirements.

Real estate expert Sara Hartigan said building is a lot cheaper in Australia, partly due to the land mass and higher population.

Most materials are imported to New Zealand so have huge margins, and if anything is manufactured locally there's a monopoly on it, creating another huge cost, she said.

A lack of skilled workers in New Zealand means a build can take a lot longer, also making it more expensive than in Australia, she explained.

To get new build costs down, we need more skilled labourers and more skilled builders, Ms Hartigan said. 

"So if you look at that across the board, we just need a more streamlined system."

She said people need to be aware that building new does not always mean it's going to be cheaper. 

"But then if you watch what you're doing, how you're spending and where you are spending, then you can definitely save and cut a few costs."

Ms Hartigan also pointed out that the property boom of 2014, '15 and '16 doubled the price of building material and also stretched out the wait time for builders. 

"While most people think you can get a house built in sort of four to five months, it's sort of nine to 12 months now," she said.

Off the back of the leaky homes saga, councils are a lot more regulated meaning builders can't go to the next step unless they've had the first step signed off, and a lot more professionals have to be in the building team, Ms Hartigan explained.

"So that escalates costs hugely."

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We talk with real estate expert Sara Hartigan.


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