KEY POINTS:
The doubling of land costs in the past five years has had the largest impact on housing unaffordability but the Master Builders Federation yesterday also complained about the impact of rising local body fees.
A delegation from the federation, which has more than 1780 member companies, appeared before
Parliament's commerce committee, which is conducting an inquiry into housing unaffordability.
Federation chief executive Pieter Burghout told the committee the single largest impact on housing unaffordability had been land cost, which had effectively doubled over five years.
Labour costs had also risen, mainly to levels they should have been at, given the building industry had been recovering in the past few years from the lower wage and salary levels of the late 1990s.
But the federation aimed much of its criticism at rising local authority infrastructure levies and fees, which it said had increased 900 per cent over five years.
It reported "huge" regional variations in local body fees.
It said more rigorous compliance requirements had come about since the leaky homes saga and the passing of the Building Act 2004.
In the early 2000s, nine to 10 pages of plan detail had been sufficient to obtain a building consent but "now some 30 pages of detail are required".
The amount of design time required to produce that standard set of plans had doubled, and the number of office staff required to facilitate the consenting process had increased.
What used to be a three-month consenting plus three-month building process in the early 2000s was now a six- to nine-month consenting process plus the three-month building process, it said. "This has impacted on builder cash flows and has to be allowed for."
Federation representative Brent Mettrick told the committee requirements in the Building Act had "quadrupled" the paperwork.
"I draw my plans now for the council and that's where it's wrong. We actually used to draw our plans for the builder to build it on site."
Councils were now sent a 78-page set of specifications, he said.
"We used to do a 12-page set of specifications. We used to do a six-page set of plans. Now, yes was there enough? No there wasn't. We should have been doing more than that. But my view as a volume builder is that we have certainly gone the other way," Mr Mettrick said.
He also told the committee he was concerned manufacturers in New Zealand had become involved with building authorities to get their products "enshrined in legislation".
This prevented him, for instance, bringing in cheap taps from China.
"I would like to be able to go to China and bring in a tap, for example, that is actually working right throughout Europe only to find that I can't get a tick on it, so my $7 tap becomes the one that's got the local tick at $62."
"These are items that every day we could certainly do better on."
He had bought $400 shower cabinets from China, but to get glass certification he was told the glass would have to be broken to prove it was compliant.
The federation wanted action on delays in the overall consenting process; for standard minor site works not to require a resource consent; greater standardisation in the consenting process; and stronger guidance from the Department of Building and Housing to ensure a consistent framework used by local authorities.
- NZPA
Through the roof
* From 2002 to 2007, land costs contributed around 50 per cent of the cost increase of housing, the Master Builders Federation said in its submission.
* Labour and material costs contributed around 20 per cent of the increase.
* Material costs have risen, but not much higher than the consumers price index levels of 5 per cent a year.
(Source: Master Builders)