The worldwide housing market has been tumultuous for the past few years. In New Zealand, these challenges have been amplified, and with fluctuating prices, rising interest rates and supply chain issues, people have been hesitant to build.
Now that we are on the other side of the pandemic, things are settling down. However, inflation is looming, leading many prospective homeowners to question if the time is right to build a new house.
In this article, we explore the cost of building a new house and our predictions for the construction industry in the next few years.
When to build a house
The right time to build a house is different for everyone. Unfortunately, market conditions and the price of materials are not predictable, so there is no point in trying to schedule your building project around them.
To put it simply, the right time to build a house is when you are ready. If your current house is not meeting your needs, a new house tailored to you is likely a wise next step, regardless of the current state of the industry.
Building a house is an investment that pays off in both quality of life and long-term financial gain. That’s because a new build house is customisable, energy efficient, and built to current Building Code standards.
The cost of building a house NZ
The cost of building a house in 2022 was the highest it has ever been. In the fourth quarter, the cost of building a standard 200m² brick and tile home increased by 1.7%. According to Stats NZ, residential construction costs in 2022 increased by 13%.
As we look forward, the latest data suggests that the increase is slowing down but that it will still rise year after year. As of January 2023, the Cordell Index shows costs per square metre range from $2,469 to $3,252 depending on the region.
The cost of building materials in New Zealand
In New Zealand, the cost of materials has gone up by 30% over the past two years. Unfortunately, there’s no sign these prices will go down any time soon.
Even if the cost of materials does decline, inflation is expected to offset this by raising the cost of labour. Since there’s more chance that material costs will increase along with the cost of living, it may be wiser to build your house now than wait for the unknown.
Hidden costs of building a home
While the cost per square metre gives a helpful estimation, the actual cost of a new build is often more than expected. This is because most construction quotes are not fixed. Due to the unpredictable nature of construction projects, there are often a few hidden costs to be aware of:
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Groundwork
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Project overruns
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Increased material costs
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Contractor travel time
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Consent and compliance
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Design edits and customisations
By opting for a prefab home, you can reduce these expensive surprises. Since prefab homes are fully built in a controlled factory environment, the prices can be fixed before construction begins. There can still be slight variations in groundwork prices, but it is usually reduced compared to a traditional build due to no concrete slab and additional foundation costs. During this unpredictable time, it pays to opt for peace of mind. You can see our full list of what you get with a Genius Homes prefab home on our standard inclusions page.
The cost of building a prefab home
While conventional on-site construction is renowned for blowing over budget, the prefab method offers a solution. By removing the unpredictability of building on-site, prefab homes can be built far more affordably.
What is a prefab?
Prefab houses are built to completion in a specialised factory. When construction is finished, the house is delivered to the building site, fixed to the foundations, and connected to site services. At this point, it’s a permanent house built to the same standards as a conventional house.
The benefits of prefab homes
Compared to on-site construction, the prefab approach is hassle-free, quick, and straightforward. The key advantages include:
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Faster construction
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Low travel costs
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Efficient building techniques
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Consent and compliance are included in the price
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Customisable plans
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Minimal disruption to your building site
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Minimal material waste
Genius Homes
Genius Homes build and deliver custom homes all over the South Island. Thanks to our factory construction and experienced team, we can cut construction time down significantly to save you time, money, and stress.
With prefab construction, your new home build will be quick, cost-effective, and predictable. There are no hidden costs so what you agree to is what you pay.
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2-bedroom houses starting from $233,300
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3-bedroom houses starting from $293,560
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4 and 5-bedroom houses starting from $398,530
Interested in a new home without all the hidden costs? Browse our range of prefab designs today.
