PHOTO: The cost of building a home in New Zealand has exploded. FILE
New Zealand’s Building Boom Comes With a Price Tag
The cost of building a home in New Zealand has exploded — rising a staggering 61% over the past decade, almost double the 33% increase in consumer prices. It’s a trend that’s pushing homeownership further out of reach for many Kiwis.
But there’s one region where builders and buyers have weathered the storm better than most: Canterbury.
Canterbury: The Cost-Controlled Outlier
Canterbury’s construction scene has outperformed nearly every other region in the country.
Construction expert Mike Blackburn, who has tracked regional building data for a decade, said the area’s cost increases were far more modest:
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Christchurch: up 38% since 2016
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Selwyn: up 52%
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Waimakariri: up 54%
“Prices have stabilised significantly,” said Blackburn. “But of course, the bad news is that when prices go up, they rarely come down.”
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Building Costs Outpacing Inflation Nationwide
According to QV CostBuilder, New Zealand’s largest construction cost database, building-cost inflation has surged at 1.8 times the rate of general inflation since 2015.
The cost to build a standard 175m² home has climbed 28 percentage points higher than the Consumer Price Index (CPI).
Most of Canterbury’s increases occurred during the 2020–21 Covid supply chain chaos, but in the last three years, Christchurch construction costs have risen only 3.1% — one of the lowest nationwide.
Competition Keeps Canterbury Building Costs in Check
Canterbury now accounts for one in five new homes built in New Zealand, and that competitive construction climate has helped suppress runaway costs.
While Queenstown, Wānaka, and Invercargill have seen robust building activity, regions like Nelson, Tasman, and Marlborough have struggled, mirroring the national slowdown in new builds.
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Material Costs That Have Skyrocketed Since 2015
Some of the steepest material price hikes include:
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Cedar weatherboards: from $17/m to $64/m (now $53/m)
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Shadowclad plywood: ↑ 110%
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Windows: ↑ 72%
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Steel roofing: ↑ 76%
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Radiata pine flooring: ↑ 122%
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Carpet: ↑ 41%
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Ready-mix concrete: ↑ 43%
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Radiata pine framing: ↑ 45%
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Construction labour: ↑ 35%
QV CostBuilder quantity surveyor Martin Bisset confirmed that construction inflation has now flattened, with annual cost increases sitting at about 1% in 2025.
New Rules, New Costs
Stricter thermal energy efficiency regulations, introduced during 2021–22, added further expenses to new builds.
While Canterbury’s strong building sector has helped balance things out, rising land prices are starting to bite.
“That’s probably the only wrinkle in the good news story that is house building in Christchurch,” Blackburn said.
The Affordability Crunch
Even in Canterbury, affordability remains a challenge. Wages have failed to keep pace with inflation — leaving many buyers squeezed.
Although the median construction cost in Christchurch sits around $2600 per square metre, prices vary widely:
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Low-end builds: from $2100/m²
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High-spec builds: up to $3500/m²
“Choosing your builder carefully might save you tens of thousands,” Blackburn advised.
The Bottom Line
Canterbury’s construction sector shows that competition and high building activity can help keep prices under control — even in a national housing affordability crisis. But as land prices rise and incomes lag behind, the dream of homeownership still feels out of reach for many New Zealanders.
SOURCE: THE PRESS