Builders shift from survival to growth as confidence rebounds

Thursday, 11 September 2025

Sixty-two percent of builders expect heir own businesses will be in better shape by the end of next year.

More than 60% of builders expect their business to be in better shape in a year’s time, signalling the construction sector may be entering a new phase, according to Master Builders.

The builders’ association has released its annual State of the Sector survey, and it showed 63% of respondents believed the economy overall would improve within a year, while 62% expected their own businesses would be in better shape.

Some improvement was beginning to show up in workloads, with 64% reporting they had strong or steady order books, up from 51% last year.

While 11% reported a critical drop-off in their work pipeline, that was an improvement from 15% last year.

Around the country conditions remained uneven, the report noted. The Southern region was improving more quickly, while Wellington and Auckland still faced headwinds.

Master Builders chief executive Ankit Sharma said there were signs the sector was entering a new phase of the economic cycle.

Patchy recovery

It was a phase that still carried risk, but also had real momentum, he said.

“The recovery is patchy, and we cannot overlook that there are building companies who are still finding things tough.

“However, there is a general sense the building sector is shifting from surviving to delivering at a scale that secures the future, and the country’s growth trajectory.”

The construction sector has been through a prolonged downturn, but the Master Builders survey was not the only recent research to suggest there might be light at the end of the tunnel.

In August the New Zealand Chinese Building Industry Association’s second annual construction sector report said the downturn looked to have hit the bottom, although challenges remained.

And Kennards Hire’s first New Zealand Construction Confidence Check survey, also released in August, found that more than 90% of industry decision-makers had a confident outlook about the next five years despite ongoing economic pressures.

But the Master Builders survey, which had more than 1000 responses from builders and homeowners who had built in the last two years, also identified the biggest issues that were facing the industry.

Eighty four percent said rising construction costs remained the number one constraint for the sector, although the latest construction data from both Cotality and Quotable Value shows the rate of inflation has stabilised.

Access to finance, government regulation, consenting and soft consumer demand rounded out the top concerns, but the survey highlighted that consenting delays continued to hinder productivity.

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It found 70% of the sector worked with more than one building consent authority; 72% had experienced ‘stop‑the‑clock’ requests beyond the 20‑day statutory timeline; and one in four had faced 10 or more requests for additional information before achieving Code Compliance.

The Government recently announced plans to amend the Building Act to allow councils to merge their building consent functions, allow private operators to do more consenting work and scrap the current building liability regime.

Master Builders was supportive of practical steps that restored confidence and lifted delivery, Sharma said.

That meant executing consenting reform well, embedding proportionate liability and implementing risk appropriate certification for low‑risk homes backed by a building guarantee.

Meanwhile, building consents, delays and rescheduling and cost overruns at 34%, 25% and 19% were the three biggest challenges for those who had built homes recently, the survey showed.

Twenty-eight percent of them had experienced significant delays, but two thirds reported a positive building experience, and 93% rated good communication as very important to the build process.

Sharma said the results were promising but the sector could not be complacent.

There were areas where improvements could lift the sector further - faster consenting, clearer pricing, and stronger communication, he said

“If we get these fundamentals right, not only do projects move more smoothly, but trust and confidence in the whole sector grows.”