Cost of building a home rises 10pc

ALAN WOOD
Last updated 14:30 16/10/2012

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The cost of building homes in Canterbury has risen nearly 10 per cent in the year to September 30, inflation figures show.

A Canterbury builder has put the extra cost down to rising health and safety costs onsite and stronger foundation requirements on technical category 1, 2 and 3 land in Christchurch.

Statistics New Zealand today said inflation had hit a 13-year low of 0.8 per cent in the year to September 30.

The consumer price index, a measure of inflation, rose 0.3 per cent in the September quarter.

Westpac economists said housing-related inflation was starting to accelerate.

Nationally, the cost of building a house was up 3 per cent in the 12 months to September 30 and 1 per cent in the quarter.

In Canterbury, the increase in building costs was 9.6 per cent over the past year and 3.4 per cent for the quarter.


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Brent Mettrick, managing director of construction firm Stonewood Homes, said he was not surprised at the higher building inflation figures.

Foundation costs had risen across all technical land categories in Christchurch because of the requirements for stronger foundations for new homes.

''For example, in the [original] building code you could have built your slab without steel in it,'' he said.

''It's now not only got normal steel, it's got ductile steel. That's a standard building code change which is quite acceptable, but there is an impact cost to this.'' 

There were higher compliance requirements for health and safety at building sites, he said.

There was more fencing required, as well a protective scaffolding ring around a house and mesh netting on top of a house frame to protect builders as roof trusses were put in place.

"For example, now I would say at least $2000 to $3000 in the last six months would be attributable to every house's [total costs] due to health and safety requirements,'' he said.

"It's a combination of things. There are site fences that never used to happen, there's edge protection around the base of the fascia, so around the complete dwelling. Fall of height used to be limited to three metres, but now the assumption is there can be injury from a fall from height.''

Statistics New Zealand said that in terms of annual inflation, national insurance prices increased 7.1 per cent for the year to September 30, which was the largest since a 7.4 per cent increase for the year to June 30, 2009.

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- © Fairfax NZ News

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