Building industry shakeup ‘not a quick fix’ for house prices
Friday, 5 April 2024
The Government plans changes that will make it easier to import building products approved for use in other countries.
Building experts say it is a good move, but a lot will depend on how it is implemented.
Changes to pricing could happen, but not immediately, they say.
Government moves to make it easier to use overseas building products should help affordability - but there are still some key details to work through, builders and construction experts say.
The Government announced on Thursday its plans to recognise building product standards from “trusted overseas jurisdictions”, which would remove the need for designers and builders to verify standards.
It also plans to require building consent authorities to accept the use of products that comply with specific overseas standards that are equivalent to or higher than those in New Zealand, and to approve the use of building products certified through reputable certification schemes overseas.
Building and Construction Minister Chris Penk said it would make it easier and more affordable for people to build or renovate a home and make the country more resilient to supply chain disruption.
In 2022, a shortage of Gib board caused significant problems for the building industry.
David Kelly, head of government relations and former chief executive at Master Builders, said the solution would not be the “be all and end all” for the industry but would help.
“More competition in the products market is a good thing. There is a bit more detail to go through. It’s not just a matter of opening it up and everyone can bring in everything they like, that would be dangerous.”
He said he was pleased to hear Penk say the Government would consult with the construction industry to make sure products from appropriate jurisdictions were allowed.
“It will be the Ministry of Business, Innovation and Employment (MBIE)’s job to work through the legislations and will set the test.
“They won’t want to do that product by product but that’s the stuff we have to work through, then the consent authorities… what we wouldn’t want to see from a construction point of view is the consent authorities left with a whole lot of questions that you end up with different answers all over.
“It’s got to be quite prescriptive in a sense, with no doubt about the products that have been agreed. It has to be on a nationwide scale otherwise we haven’t gone anywhere.”
Julien Leys, chief executive of the New Zealand Building Industry Federation, said it would help to bring prices down but could take some time. It would take time to implement and longer to have an effect on competition, he said.
Shane Brealey, managing director of Simplicity Living, said international sign-offs should always have been transferable, but there would need to be some oversight on the areas of potential difference in New Zealand.
“One in particular that jumps out to me is solar. Our sun is very different to almost every other part of the world.”
He said he experienced this with German plexiglass that had a 25-year warranty but started failing within two years because of the temperatures it was exposed to in this country.
“It was a multimillion-dollar problem. But apart from that, what’s good in Australia or Japan or Korea should be good here. They should have done this years ago.”
He said the move would put pressure on local manufacturers to be more competitive. Prices were still being put up regularly, he said.
“The threat of people being able to bring in overseas equivalent product will hopefully be enough to keep the local manufacturers more honest.”
AUT professor John Tookey said it was something he had suggested as a solution previously.
“That having been said, the key question is whether or not the banks are on side with it or the insurers. There’s fundamentally a huge difference between the cost of acquisition and maintenance through life. We have particular building standards here for a reason.”
He said it would take courage for people to put their names to a product as being appropriate in a “post leaky building world”.
“I’m not trying to say this is a bad idea - it is not. If you’re getting down to structural stuff and you’re getting down to certain systems of where you use certain materials and certain solutions there could be issues with regard to performance through life. There might be none but someone has to make the call and say ‘this is fine’ - do you want to be known as the guy or girl who creates leaky building 2.0?”