4 Nov 2013

Development fees drive up housing costs, says construction group

12:03 pm on 4 November 2013

A new report says a review of development costs and how they vary across the country could help lower the cost of housing.

The Construction Strategy Group has released its report into the building sector saying it backs up with facts what has generally been taken as anecdotal.

The Construction Strategy Group report says housing costs have risen 8% on average in five years.

It also says a small sample suggests land development costs are up by 25%, and it says consent fees have jumped 75% in six years.

The report has also found labour costs have gone up 12.5 % and material costs up 12% since 2008.

A member of the group, Mike Fox, says prices would come down if more land could be developed.

"If land can come to the market quicker, and it is easier to develop then the cost of land will come down," he says.

Mr Fox says development fees range from $14,000 in some areas to more than $60,000 in others, which he called a huge variation.

An advisor to the Construction Strategy Group, Bruce Kohn, says planners need to be more flexible.

"Allowing builders to utilise the full width of their sections going across to both sides, plus coming forward to the front of the section which many councils will nor allow and which plays against efficient use of the space that's available."

The report has been given to the government.