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

Four years ago, we published a story on our website about the most expensive regions in New Zealand to build a new home. Ever since, it’s been one the most popular stories on our website.

Back then, Auckland had the highest average house prices, and Otago was the most expensive region in which to build a new home.

In 2016, the average cost of building a new home in Otago was $396,000, for the cost of the house alone, without land. This compared to $390,000 in Auckland. Nationally, the average was $346,000, or $1906 per m².

So, since then, how have things changed?

The cost of building in 2020

Err, not much! Prices have gone up everywhere. But according to the latest data from Stats NZ, Otago remains the most expensive place to build a new home. In all, it boasts the biggest homes and the highest construction costs per m².

Of course, given that the Queenstown-Lakes District is the playground of the wealthy, this should come as no surprise. It only takes one or two billionaires’ international holiday homes to skew the data.

However, after crunching the numbers from the building consent data from January to July 2020, Canstar’s number geeks did throw up some surprises.

When looking at the average cost per m², regions such as Nelson and Hawke’s Bay come out as more expensive than Auckland, and not too far behind Otago.

Nationally, the average cost per m² sits at $2238, and the average price of building a new home is $428,791. But from region to region, the numbers look like this:

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

We’re building more, bigger homes!

Three years ago, we built fewer homes than in the mid-1970s. However, since then the pace of building has ramped up. Last year, 37,538, new dwellings were consented, up 14% on 2018. And this year, by the end of July, we’d already hit 22,141 consents.

However, these numbers look likely to represent a peak. Indeed, since March this year, the number of overall new building consents has tailed off. Whether the drop is due solely to COVID-19, or whether it’s just part of the cyclical nature of the building industry remains to be seen.

But one trend that doesn’t look like stopping is the increasing size of the homes we’re building. Since our last story, in 2016, the average size of a new Kiwi home has increased by 10m²:

Although region to region, there’s still quite a difference in the size of houses we’re building:

Construction Loans

If you’re considering a new build, 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 imperative for you to check out the current home loans available in the market. The table below is just a snapshot of the current floating rate building loans available, for a loan amount of $350,000 if building in Auckland, sorted by Star Rating (highest to lowest). If you’re interested in comparing for other regions, just click on the big button below!

Compare home loans