To buy or to build – it's a simple question, for sure. But, unfortunately, the answer is a little more complicated. So Canstar decided to delve a little deeper into the question and crunch the numbers to discover whether it's cheaper to buy an existing home in New Zealand or to build a new one.
Cheaper to buy or build? It's all about the land!
A couple of years ago in one of its Financial Stability Reports, the Reserve Bank noted that land accounts for around 60% of the value of a Kiwi home. So as a starting point for our Build vs Buy number crunching, let's break down the median house prices around the country into two components:
- Cost of land (60%)
- Cost of home (40%)
Cheaper to buy or build? Cost of an existing home
Based on May 2026's median house prices from REINZ, if you break down the cost of an existing home into its two components, it looks like this:
Region | Median house price | Cost of land (60%) | Cost of home (40%) |
Auckland | $1,005,000 | $603,000 | $402,000 |
Bay of Plenty | $800,000 | $480,000 | $320,000 |
Tasman | $792,000 | $475,200 | $316,800 |
National Median Price | $775,000 | $465,000 | $310,000 |
Wellington | $770,000 | $462,000 | $308,000 |
Waikato | $750,000 | $450,000 | $300,000 |
Canterbury | $725,000 | $435,000 | $290,000 |
Nelson | $689,000 | $413,400 | $275,600 |
Otago | $685,000 | $411,000 | $274,000 |
Hawke’s Bay | $675,000 | $405,000 | $270,000 |
Northland | $660,000 | $396,000 | $264,000 |
Marlborough | $645,000 | $387,000 | $258,000 |
Taranaki | $602,000 | $361,200 | $240,800 |
Gisborne | $566,000 | $339,600 | $226,400 |
Southland | $540,000 | $324,000 | $216,000 |
Manawatu-Whanganui | $525,000 | $315,000 | $210,000 |
West Coast | $375,000 | $225,000 | $150,000 |
Cheaper to buy or build? Cost of a new build in NZ
Now we have an idea of land values, it's time to factor in building costs.
On the Canstar website, our story How Much to Build a New House in NZ is one of the most popular reads. It reveals the average cost of new builds across the county based on building consent applications.
By using these building consent figures, and the land prices listed above, we can work out a rough estimation of how much it costs to buy a piece of land and build a new house in different regions around the country:
Region | Land cost | Cost of new build | New build + land |
Auckland | $603,000 | $450,467 | $1,053,467 |
Bay of Plenty | $480,000 | $445,869 | $925,869 |
Tasman | $475,200 | $512,297 | $987,497 |
National Median Price | $465,000 | $450,390 | $915,390 |
Wellington | $462,000 | $421,421 | $883,421 |
Waikato | $450,000 | $490,229 | $940,229 |
Canterbury | $435,000 | $402,377 | $837,377 |
Nelson | $413,400 | $420,176 | $833,576 |
Otago | $411,000 | $532,517 | $943,517 |
Hawke’s Bay | $405,000 | $488,061 | $893,061 |
Northland | $396,000 | $541,067 | $937,067 |
Marlborough | $387,000 | $473,950 | $860,950 |
Taranaki | $361,200 | $480,674 | $841,874 |
Gisborne | $339,600 | $359,830 | $699,430 |
Southland | $324,000 | $471,155 | $795,155 |
Manawatu-Whanganui | $315,000 | $467,355 | $782,355 |
West Coast | $225,000 | $413,118 | $638,118 |
Cheaper to buy or build? Old vs new
When the price of land is factored into the cost of a new build, they work out more expensive (on average around a third more expensive) than existing median-priced homes in the same areas:
Region | Median house prices | Cost of new build | % Difference |
Auckland | $1,005,000 | $1,053,467 | 5% |
Bay of Plenty | $800,000 | $925,869 | 16% |
Tasman | $792,000 | $987,497 | 25% |
National Median Price | $775,000 | $915,390 | 18% |
Wellington | $770,000 | $883,421 | 15% |
Waikato | $750,000 | $940,229 | 25% |
Canterbury | $725,000 | $837,377 | 16% |
Nelson | $689,000 | $833,576 | 21% |
Otago | $685,000 | $943,517 | 38% |
Hawke’s Bay | $675,000 | $893,061 | 32% |
Northland | $660,000 | $937,067 | 42% |
Marlborough | $645,000 | $860,950 | 33% |
Taranaki | $602,000 | $841,874 | 40% |
Gisborne | $566,000 | $699,430 | 24% |
Southland | $540,000 | $795,155 | 47% |
Manawatu-Whanganui | $525,000 | $782,355 | 49% |
West Coast | $375,000 | $638,118 | 70% |
Cheaper to buy or build? New is expensive!
That new builds are no cheaper than existing homes should not be a surprise. New things are generally more expensive than second-hand items. And even a basic new build is going to be worth a lot more than an unrenovated older home.
With average building costs now around $3300 per m2, a 178m2 Kiwi home (the average size built over the past year) is going to cost close to $600,000 to build. Then you need to add the cost of the land, which will be a further $400-$500k in most areas.
However, there are things you can do to keep building costs down:
- Buy land in cheaper new greenfield developments, outside of more expensive inner-city suburbs
- Build a smaller home
- Avoid elevated sites, exposed to the wind
- If possible buy a flat level site, avoid steep (or even not so steep) sites that require retaining walls
- Avoid unsuitable ground requiring engineering design, or places with difficult site access
- Don't use large square metres of glass (requiring steel portals)
- Have smaller rooms, not open, expansive living areas that requiring engineering due to the lack of walls to brace
- Avoid cantilevered decks, roofs and floors
- Don't use expensive cladding, like cedar, or roofing, such as tray roofing
- Say no to any build methods that are time consuming
