18 Oct 2012

Canterbury building costs up nearly 10%

7:45 pm on 18 October 2012

Building a house in Canterbury is less affordable than ever as construction costs soar.

The cost of building homes in Canterbury rose nearly 9.6% in the year to September, compared to 3% nationally, Statistics New Zealand figures show.

Economists and Canterbury builders say the price is likely to rise even more as the rebuild gets into full swing.

Brent Metrick from construction firm Stonewood Homes attributes the increase to a recent tightening of occupational health and safety restrictions, which he says have added a minimum extra cost of $3000 to each job.

Robin Clements from UBS Investment Bank says the growing construction prices are making the already unaffordable housing market even worse.

He says the construction activity in Christchurch will be watched closely as a potential driver of higher inflation.