Building Costs: How Much to Build a New House in NZ?

Auckland remains the most expensive city in New Zealand to buy a house – but it’s not the most pricey when it comes to building a new property.

Building Costs: How Much to Build a New House in NZ? In this article we cover:


In August 2020, we published an update to our article: Building Costs: How Much to Build a New House in NZ? Back then, Auckland had the highest average house prices, and Otago was the most expensive region for a new build home. So, over the past year, how have things changed?

Well, one thing remains the same: Auckland is still the most expensive place in NZ to buy property.

Average cost of building a house in New Zealand

Median cost of a house in 2021

For the past 12 months, the NZ property market has run crazy hot. Auckland remains in top spot for median prices, but plenty of other regions are on its tail. And there have been some huge year-on-year increases. What is going on in Gizzy: 72.5%?!

According to REINZ’s Monthly Property Report for May 2021, nationally, the median house price is: $810,000, up 19.1% YoY. Around the country:

Region Median Price YoY Increase
Auckland $1,125,000 22%
Wellington $870,000 19.2%
Bay of Plenty $800,000 27%
Hawke’s Bay $770,500 17.6%
Tasman $767,500 16.9%
Nelson $743,000 15.1%
Waikato $730,000 37.7%
Otago $710,000 58.8%
Gisborne $690,000 72.5%
Marlborough $672,000 46.1%
Northland $670,000 48.9%
Manawatu-Whanganui $580,000 46.8%
Canterbury $566,000 22%
Taranaki $540,000 42.1%
Southland $402,000 30.9%
West Coast $275,000 27.9%

Source: REINZ

Cost of building a new house in 2020

But what about the cost of building a new home? In the middle of last year, the national average cost per m² was $2238, and the average price of a new build was $428,791. Region to region, the numbers looked like this:

Region $ per m2 Average Price Average Size
Otago $2659 $547,672 206m2
Wellington $2495 $434,790 174m2
Nelson $2431 $439,366 181m2
Hawke’s Bay $2429 $478,784  197m2
Northland $2330 $456,747 196m2
Bay of Plenty $2279 $389,658 171m2
Tasman $2276 $410,033 180m2
Auckland $2248 $451,910 201m2
Gisborne $2235 $402,322 180m2
Waikato $2204 $421,019 191m2
Marlborough $2119 $429,860 202m2
Canterbury $2066 $392,801 190m2
Manawatu-Whanganui $2051 $374,214 182m2
Southland $2003 $372,835 186m2
West Coast $1993 $310,962  156m2
Taranaki $1990 $362,717 182m2

Average costs are estimates based on building consent applications and exclude fees and land prices.

New build NZ

Cost of building a new house in 2021

So how have things changed, have prices for building new homes risen as much as prices for existing homes? The answer is yes … and no.

Nationally, the average price per m² has increased from $2238 (2020) to $2428 (2021). That’s an increase of 8.5% – a far smaller percentage than the increase in median house prices.

However, conversely, the average price of a new build has decreased: from $428,791 (2020) to $378,307 (2021). This is because there’s been a marked decrease in the size of the homes consented. From a national average of 192m2 last year to just 155m this year. 

As you can see below, Wellington now boasts the biggest per m2 costs, Canterbury and West Coast are the cheapest and Auckland sits in the middle. However average new build prices vary, due to differing house sizes, region to region (for more on this, see below).

Region $ per m2 Average new build price
Wellington $2745 $391,957
Hawke’s Bay $2708 $373,334
Otago $2648 $441,898
Nelson $2565 $459,604
Bay of Plenty $2564 $394,851
Auckland $2507 $371,414
Northland $2410 $421,899
Tasman $2333 $406,410
Gisborne $2320 $310,037
Waikato $2274 $403,591
Taranaki $2257 $338,550
Marlborough $2256 $428,058
Southland $2202 $360,033
Manawatu-Whanganui $2201 $366,244
Canterbury $2173 $345,107
West Coast $2115 $300,553
North Island  $2472 $380,287
South Island $2292 $371,897

We’re building more, smaller homes!

Ten years ago, we were building fewer homes than in the mid-1970s. However, since then the pace of building has ramped up. In the 12 months to April last year 37,186, new dwellings were consented. And to April this year, the number reached 42,848 consents.

However, as you can see below, the homes we’re building are shrinking in size.

Years 1974 2000 2010 2020 2021
Homes consented 39,525 25,010 28,038 37,186 42,848
Average floor area 110m2 166m2 182m2 158m2 1552

Region to region, while there’s still quite a difference in the size of houses we’re building, pretty much across the board all the homes we’re building are smaller. The only exception being in the Waikato, where average floor space increased slightly.

Region Average Size 2020 Average Size 2021
Otago 206m2 167m2
Marlborough 202m2 190m2
Auckland 201m2 148m2
Hawke’s Bay 197m2 138m2
Northland 196m2 175m2
Bay of Plenty 191m2 154m2
Canterbury 190m2 159m2
Southland 186m2 163m2
Taranaki 182m2 150m2
Manawatu-Whanganui 182m2 166m2
Nelson 181m2 179m2
Gisborne 180m2 134m2
Tasman 180m2 174m2
Wellington 174m2 143m2
Waikato 171m2 177m2
West Coast 156m2 142m2

New build: construction loans

If you’re considering a new build, big or small, wherever you are in the country, it’s worth reading our story What is a Construction Home Loan. For as you’ll see, the structure of a loan to build a new home is usually different to a standard home loan.

It’s also worth reading: Building Costs Per Square Metre in NZ: Busting the Myth. For as our article explains, while building costs per m2 are okay as a general guide to pricing in different regions, when it comes to individual house designs, per m2 prices can be misleading when determining price.

If you’re currently considering a home loan, the table below displays some of the 2-year fixed-rate home loans on our database (some may have links to lenders’ websites) that are available for first home buyers. This table is sorted by Star Rating (highest to lowest), followed by company name (alphabetical). Products shown are principal and interest home loans available for a loan amount of $500K in Auckland. Before committing to a particular home loan product, check upfront with your lender and read the applicable loan documentation to confirm whether the terms of the loan meet your needs and repayment capacity. Use Canstar’s home loan selector to view a wider range of home loan products. Canstar may earn a fee for referrals.

 

Compare home loans

About the author of this page

Bruce PitchersThis report was written by Canstar’s Editor, Bruce Pitchers. Bruce began his career writing about pop culture, and spent a decade in sports journalism. More recently, he’s applied his editing and writing skills to the world of finance and property. Prior to Canstar, he worked as a freelancer, including for The Australian Financial Review, the NZ Financial Markets Authority, and for real estate companies on both sides of the Tasman.

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