Construction costs & housing market dynamics
Atom Go Tian Senior Data Analyst Ray White Group
New Zealand ’ s housing landscape is experiencing a significant change , driven by several critical factors , including higher construction costs and corresponding buyer behaviours .
Since 2021 , the country has experienced an unprecedented surge in the cost of building new . Although the rate of increase has recently slowed , the Cordell Construction Cost Index ( CCCI ) reveals that construction costs have risen by more than 40 per cent over the past decade .
UNDERSTANDING THE IMPACT
As of July 2024 , records show New Zealand has around 8,615 residential properties with no prior sales history – which indicates a market proportion of around 25.30 per cent of new-build homes .
This marks a significant decline from just three years ago when there were 24,205 first-time sales in 2021 – making up around 27.20 per cent of total sales that year .
While the methodology isn ’ t fool proof ( our records only extend back to 1975 and would , for example , not be able to capture sales that occurred before that year ), it nonetheless provides useful insights into how new homes are priced relative to long-standing homes .
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