3 Sep 2016

Cost of building houses outstrips number being built

10:07 am on 3 September 2016

The number of homes being built is increasing, but the cost of building them is increasing faster, a building industry leader says.

Building site in an East Auckland suburb

Photo: RNZ / Claire Eastham-Farrelly

New data from Statistics New Zealand shows the national value of construction rose 7 percent in the June quarter.

Compared to June 2013 residential building has increased 45 percent but there is also a 74 percent increase in the value of work.

Building and Construction Industry Training Organisation head Warwick Quinn said while a similar number of homes were being built as in 2004, it was costing more.

"We're currently building at levels slightly below where we were prior to the GFC [global financial crisis] at its peak, but the value of that work is significantly higher and if you just look at the statistics issued by Stats New Zealand on Friday it shows that the gap between volume and value almost doubled."

Mr Quinn said it was hard to say why, but labour and material costs, bigger homes and property prices would all play a part.

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