Building Costs: How Much to Build a New House in NZ? In this article we cover:
- Median cost of a home in 2021
- Cost of building a new house in 2020
- Cost of building a new house in 2021
- We’re building more, smaller homes
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.
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|
|Bay of Plenty||$800,000||27%|
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|
|Bay of Plenty||$2279||$389,658||171m2|
Average costs are estimates based on building consent applications and exclude fees and land prices.
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 $378,307 (2021). This is because there’s been a marked decrease in the size of the homes consented. From a national average of 192m2 last year to just 155m2 this year.
As you can see below, Wellington now boasts the biggest per m2 costs, Canterbury and West Coast are the cheapest and Auckland sits in the middle. However average new build prices vary, due to differing house sizes, region to region (for more on this, see below).
|Region||$ per m2||Average new build price|
|Bay of Plenty||$2564||$394,851|
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.
|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, across the board all the homes we’re building are smaller.
|Region||Average Size 2020||Average Size 2021|
|Bay of Plenty||191m2||154m2|
|Bay of Plenty||171m2||154m2|
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.