Great News if they can accomplish it but some fundamental aspects of property developing are being missed.
Labour’s housing spokesman Phil Twyford said KiwiBuild would deliver the equivalent of a Hobsonville $485,000 two-bedroom terrace home for $360,000 by forgoing the developer’s margin on the land cost ? saving $36,000 and a further $89,000 would be saved by using off-site manufacturing, bulk buying building materials and reducing builders’ margin through high-volume tendering.
The process would drop the build cost from $3389 per square metre to $2400, Mr Twyford said.
“When you’re building at scale – when you’re building 10,000 houses a year, you can do deals that drive down the cost of building materials.
“Currently, Kiwis pay 30 per cent more than Australians do for the same building materials so we know that we can really push down the cost of building materials.
“Also, in some cases with KiwiBuild the Government will be the developer, that’s how we’ll get better control over land costs and for the units we’re talking about today, we think we can knock 20 per cent off the cost of the land.”
“The other way we can really drive the cost down is through off-site manufacturing and by the scale of KiwiBuild we can tender that work out to companies that can really crank up their capacity, build factories [and] make better quality houses at a much more cost-effective price.
“There are several companies in New Zealand who are already doing this who are itching to crank up capacity.
“The Germans do it, the Scandinavians do it, the Americans do it, it’s actually time that we did it.”