Hon Dr Nick Smith
Minister of Housing
Hon Craig Foss
Minister of Commerce
11 May 2013
Residential construction costs to be scrutinised
A market study into residential construction costs has been released today for public input by the Government.
“The costs of building a house in New Zealand are too high as identified by the Productivity Commission’s report. This
issues paper and market study is about identifying why some house construction costs are as much as 30 per cent more
expensive than Australia and how we can get costs down,” Housing Minister Dr Nick Smith said.
Commerce Minister Craig Foss said the issues paper is primarily focused on improving competition and productivity.
“The competition work focuses on potential barriers to effective competition within the building materials and services
market, while the productivity work focusses on factors to improve the overall productivity of the residential
construction sector,” Mr Foss said.
The Ministers said the issues paper will help inform the first steps of the market level study by the Ministry for
Business, Innovation and Employment and the Commerce Commission. The Ministers are due to report back to Cabinet later
this year on proposed solutions to the problem.
“There is no single silver bullet to making New Zealand housing more affordable. This work builds on the Auckland
Housing Accord, in which a commitment was made to examine materials and construction costs. We need to address all of
the issues from land, infrastructure, materials, labour, and compliance costs if we are to achieve our goal of more
affordable housing.
Submissions on the Residential Construction Sector Market Study issues paper close on 10 June 2013.
ends