KEY POINTS:
Higher city council building fees are making it even more difficult for first-home buyers to enter the booming property market.
Councils across Auckland are proposing fee rises to cover the costs of the Government's new building regulations, designed to prevent another leaky homes fiasco like that in the
late-1990s when many developments were given consent but not inspected thoroughly.
However, builders and property developers say increased building consent fees, number of inspections and infrastructure levies - up to $30,000 - are costs that are being passed on to buyers.
A property developer building a million-dollar home in the swanky Auckland suburb of St Heliers, who asked not to be named, has spent more than $30,000 on council fees - more than the survey, engineering, geotechnical and architectural fees combined.
He said Auckland City Council's proposed fee increase, 4.9 per cent on top of an 18 per cent rise two years ago, was bad enough but the sheer number of fees "just tally up".
"You can't get building consent for less than $10,000 when it used to be $1500 or $2000 a few years ago. There's no doubt it's pushing up house prices."
"In the old days", plans would be submitted to council officers, who would review the designs and visit the site before consent was given, he said.
Today, professional engineers and geotechnical experts review the developers' plans, write a report for the council, which is reviewed by council officers, who visit the site - and charge more than the original engineer for their time.
If consent issues are raised, the original engineers are sent back to visit the site, as well as the council staff.
"To be honest, that is what irritates me the most. You wouldn't mind paying it if you felt you were getting value for money," the developer said.
The stricter Government regulations on building homes to prevent liability for leaky homes - and the subsequent increase in inspections - had gone too far, the St Heliers developer believed.
"We've gone from one extreme to another, it was too lax, now it's the opposite. If it was in the middle, it would be bang on."
Property investors spoken to by the Herald on Sunday said new homes should meet the cost of impact on infrastructure, but council fees were making property more expensive.
Ashley Church, chief executive of the Auckland Property Investors Association, said an increase in building fees was clearly a factor in making houses unaffordable in the city.
Pieter Burghout, chief executive of Master Builders, said the cost of building a new house had increased by $150,000 in the past five years.
About 25 per cent of that was attributed to rising industry costs - materials and labour - and of the other 75 per cent, Burghout said half would be the result of increased land prices and the rest council levies.
Burghout had heard of a case on the North Shore, where a kitchen worth $40,000 was stung with a further $30,000 in levies and fees.
He had no problem with the user-pays scheme for building consents - to pay for more inspectors and inspections - but accused councils of using infrastructure fees as a revenue gathering tool.
On March 21, in Neil Construction and Others v North Shore City Council the judge found that councils did not have the power to levy new sections and houses to pay for major projects which will benefit all ratepayers.
The council had to contribute $82.5 million towards bus stations on the North Shore and had decided to fund 94.2 per cent of it by development levies - or levies on new homes - and only 8 per cent by general rates.
Auckland Mayor Dick Hubbard defended the number of building inspections for each site, saying council had been deemed partially liable for shoddy building consents contributing to the leaky homes problem.
Increases for 2007
The proposed building consent increases for 2007 from councils in the Auckland region are:
* Auckland City: 4.9 per cent. No figure for average.
* Manukau City: 5.9 per cent to $3500 average.
* North Shore City: 35 per cent to $3640 average.
* Waitakere City: 31 per cent to $4222 average.
