Home ownership is a major milestone for many Kiwis. Whether they are first home buyers or adding to an existing property portfolio, their question on whether to buy or build is one that needs to be contended with. While the quickest solution is always to buy an existing home, between the renovations usually required and the need to compromise based on what’s available on the market, building a home is sometimes the more attractive option for people in the market.

As we navigate 2024, many Kiwis are grappling with the question: “Is now the right time to build a house?” With various factors influencing this decision, it is crucial to examine current trends and market conditions closely. So let’s take a moment to delve into key considerations such as building material costs, labour costs, interest rates, housing consent figures, the election year’s impact, and the potential for higher resale values of new builds to provide a comprehensive answer.

 

Advance Build – Bridging the Gap Between New Build Quality and Time Efficiency.

For the past 16 years, Advance Build have been New Zealand’s prefabricated home experts. NZ owned and operated, the team at Advance Build construct prefabricated homes in our built-for-purpose factory in Kerikeri. Once the home has been constructed, the home is transported to our client’s property and placed on its foundations. This entire process, from initial consultation through to final sign off, is handled every step of the way by our incredibly experienced team.

This approach to new home builds streamlines the entire construction process, with the combination of a weather controlled environment, experienced specialists, access to quality materials and an exciting range of customisable floor plans, results in a premium, new home with a quick turnaround. Advance Build’s prefabricated homes allow you to efficiently build your dream home without having to compromise on quality or timeframe.

 

Building Material Costs

One of the primary concerns when building a house is the cost of materials. According to a recent Core Logic report, the increase in building costs has been slower than the past decade’s average. Additionally, materials are currently in good supply, alleviating some of the stress associated with potential shortages. For those considering building, now might be an opportune time to take advantage of stable material costs and availability.

Coupled with Advance Build’s approach to prefabricated floor plans and designs, the company is able to predict supply and demand, bypassing one of the major bottlenecks that often cause delays in traditional construction projects. In addition to this, the factory setting reduces construction waste and excess materials, removing a major variable from the project’s budget.

 

Labour Costs

Labour costs are another critical factor. The same Core Logic report highlights that the industry is experiencing less pressure on workloads and overall capacity due to a decline in housing consents. This reduction has eased the demand for labour, potentially making it easier and more cost-effective to secure skilled workers for your project. Lower labour costs can translate to significant savings, making the prospect of building more attractive. In the case of Advance Build, a major advantage of the construction taking place in our factory means the overheads for labour are reduced, relying on a tight knit team of specialists to efficiently work on every project.

 

Interest Rates

Interest rates play a pivotal role in financing any new build. According to a Spinoff article, interest rates are forecasted to come down. However, they are currently stable, so waiting for rates to drop further might not be necessary. Locking in a favourable rate now could provide financial stability and predictability for your building project.

 

Housing Consent Figures

Housing consent figures have dropped considerably, which impacts the cost and stress factor of building a house. Fewer consents typically lead to less competition for resources and potentially lower prices. This downturn can also mean a faster approval process and reduced bureaucracy, streamlining your path to homeownership. The red tape surrounding consents is also likely to continue to be cut – an expected feature of the current National government. Which brings us to our next factor when considering constructing a new home:

The Election Year and Its Effect on Housing

Election years often bring about changes that affect various industries, including the housing market. The new government has positively influenced the building sector, fostering a more favourable environment for new construction projects. Policies aimed at stimulating the economy and supporting the housing market can provide additional incentives and stability for prospective builders in 2024. With policies such as the reenactment of interest deductibility on mortgages and changes to tenancy laws, the National Government has made it clear that supporting home ownership is a major priority for them.

New Builds Sell for More

Circling back to the similarities between first home buyers and property investors, they usually share another factor – that being that owning a home is looked at as an investment for the future. New homes tend to carry a premium, offering a higher resale value compared to older properties. A Core Logic report indicates that new builds can sell for more in the coming years, making them a worthwhile investment. By choosing to build in 2024, you could capitalise on this trend, ensuring a strong return on your investment when it’s time to sell.

 

Thinking About Building a House in 2024?

Making the decision to build a house involves weighing multiple factors. Current trends suggest that building material costs are stable, labour is more affordable, and interest rates are steady. The decline in housing consents and positive governmental policies further contribute to a favourable building environment. Moreover, the potential for higher resale values of new builds makes 2024 a promising year to embark on your building journey.

At Advance Build, we offer a unique solution with our prefabricated homes, combining quality craftsmanship with efficiency and a hassle-free build solution. Our prefabricated homes are designed to meet your needs and budget, providing a smart choice in today’s market conditions.

Consider all these factors carefully and align your decision with your financial and personal goals. If you’re ready to explore the possibilities of building a new home and wish to know more about prefabricated houses, contact Advance Build today to learn more about our services and how we can help you achieve your dream home.