Construction material shortages, price hikes plague building industry

A building under construction in Wellington. Photo / File

By Nicolas Pointon of RNZ

The rising cost of construction materials shows no signs of slowing, as widespread shortages of key products continue to plague the industry.

Tradespeople and building suppliers have told RNZ they are struggling to get their hands on basic materials such as exterior and interior cladding, which is causing long delays that are doubling some build times.

Combined Building Supplies Co-Coperative chairman Carl Taylor said the delays were the result of increased demand as residential building consents hit record highs, a scarcity of labour needed to make the materials and a shortage of the materials needed to make specific building products.

Taylor singled out GIB plasterboard, saying its lead time was now hitting May or June.

"If we can't get the materials we can't work, plain and simple," he said.

Fletcher Building's products division confirmed GIB plasterboard was in hot demand and it was keeping customers informed about any timeframe changes to assist them getting the products they need.

Taylor said the ongoing delays for a wide range of products was stretching the build time for an average house from five months to 12.

"We are aware of jobs where the builders will stand their frames and they are having to wait another three or four months until they can get their cladding, or get their roofing, or get their windows - and that's just in the residential sector.

The latest Price Index data for the December quarter revealed constructions costs had jumped by 16 per cent in the past 12 months.

Taylor said Combined Building Services was forecasting further price hikes of 15 per cent across all products in the coming year.

Tradespeople would wear the costs in the short-term but it was inevitable that the price increases would be passed on to consumers, Taylor said.

Building supplies merchant BuildLink general manager Simon Burden said he did not think much could be done about the shortages other than different parts of the supply chain communicating clearly with one another to manage expectations.

"If we were to have a set of plans to come over our desk at one of our stores right now, you've got to be realistic with the builder or the homeowner who's wanting to build that house [about how long it would take]."

Taylor said clear communication within the industry was critical but added that he thought the Government needed to have a constructive look into how the supply issues could be addressed.

He said the time it took for certain products to get clearance from councils or the Building Research Association of New Zealand (Branz) before they could be used in New Zealand was just another factor causing delays.

"That system almost needs to be fast-tracked so other companies on the other side of the world can actually bring their products here with ease.

"But on the same token, the products still have to be tested and I know there's some time around that, but it is something that could be looked at."

A spokesperson for Branz said when companies brought their products to the domestic market, it was up to the councils to test if they met the building code through the consenting process.

"We can't definitively say how many individual products are available in the New Zealand market or how many are used in an average build, (hundreds if not thousands)."

Not all of these will be either appraised or individually certified, the spokesperson said.

"It is therefore unreasonable to imply that product testing processes are a considerable contributor to broader supply chain issues."

Branz offered appraisals and CodeMark certifications as a means for suppliers to ensure their products comply with requirements, but it was only one of a range of CodeMark certification providers, and suppliers did not need to need to engage it to demonstrate code compliance.

"They may submit their own evidence or offer independent expert evaluation to ensure that a council has confidence that all components of a building are fit for purpose."