While affordability is a key focus for BRANZ research, it’s not just about upfront construction costs. BRANZ is aiming for housing that is affordable for people to build, maintain and live in. This broad view encompasses operational costs, resilience and universal design.
There is little point in saving money upfront if winter power bills are enormous, there are eye-watering repair costs when a poorly designed home is damaged in a flood or a house requires extensive work to make it suitable for a homeowner who has lost mobility.
The keys to building a home that is affordable over its lifetime are:
- simple shapes
- smart design prioritised over size
- minimising waste
- reducing labour costs
- designing for lower operational and maintenance costs
- designing for resilience
- using computer modelling where possible.
Keep the building shape simple
Using a regular floor plan with a simple roof design can save big sums of money through reduced design, material and construction costs. It can also make for easier maintenance and fewer risks to material durability.
As part of an MBIE research project, sustainability firm thinkstep-anz, engineering consultancy Mott MacDonald and quantity surveyors Prendos calculated potential carbon and cost savings for one specific home.
A more regular floor plan with the same floor area could reduce external and internal wall area by around 2–2.5% for a cost saving of $12,000–15,000. A less complex roof design (fewer hips and valleys) for the same floor area could reduce costs by around $7,000–8,000.
Smaller but smarter
We’ve all been in homes with a clever use of space, where all the needs are met without the dead space of hallways and unused corners. That approach should be used in every new home. Larger houses cost more in materials, energy use and maintenance. With smart design and layout, ceiling heights and glazing, compact affordable homes can feel very welcoming – see the Living House on page 68 as one example.
Building smaller homes not only improves affordability but also helps meet community needs. The number of one-person households has increased significantly over time – they formed nearly a quarter of households in the 2023 Census, almost 35,000 more than a decade earlier – yet the traditional 3-bedroom home is still the most common type being built (followed by 4-bedroom homes), with 1-bedroom homes accounting for less than 10% of new builds.
Save on waste, save on cost
A 2015 AUT study put the cost of materials wasted during the construction of a typical new house at $31,000. A 2023 audit of the construction of a new 155 m² home at Whenuapai confirmed that ‘the estimate of 4.5 tonnes of waste per new house build seems to be accurate’ but also found that architectural features and materials had a large impact on the weight of the waste.
A disturbing finding of the audit: ‘A surprising component of the skip waste was the amount of brand-new and unused building products that ended up in the skip.’
The cost of labour
With labour accounting for around 40–50% of the cost of many new homes, cutting out delays and hold-ups and reducing construction times and therefore labour costs can offer big potential savings. That same 2015 AUT study estimated that the delays and time wastage on site could have a dollar cost as high as $74,000.
Shane Brearley of Simplicity Living says that subcontractor pricing calculations often make allowances of as much as 25% for all the delays, hold-ups and uncertain-ties around a construction project, and cutting this out of Simplicity projects is one explanation for their much lower construction costs – see the article Innovation in housing affordability on page 67.
Significant time reductions sometimes require a different approach to conventional timber stick construction. One option is to use prefabricated building elements made with structural insulated panels (SIPs) or cross-laminated timber (CLT) panels that can be assembled on site within a few weeks.
In some cases, material costs may be slightly more, but overall cost and long-term performance bring an advantage. Affordable housing does not mean that only the lowest-cost materials are used.
Focusing on safety is also important in keeping build times as short as possible. The New Zealand construction sector loses 8% of working days to injuries – roughly twice the rate for all industries.
Go on as you plan to start
How to achieve lower operational costs:
- Good site selection. A building site within walking distance of a bus stop or train station and within walking distance of shops can help cut living costs.
- Orienting the house and designing interior layout and glazing so the sun warms the living areas in winter but there is shade to avoid midsummer overheating – reducing heating/cooling costs.
- Specifying very efficient systems and appliances, especially in space and water heating (heat pumps are a good option in each case).
- Using building materials that require less (and less expensive) maintenance.
- Following universal design principles (making buildings accessible to all people of all abilities at any stage of life) from the early design stages, when they come with the lowest costs. Altering a home for an ageing or disabled occupant down the track can be many times more expensive.
Designing for resilience
Resilience is about considering and designing for potential risks such as earthquakes, flooding or sea-level rise. While the Building Code considers life safety of building occupants, a resilient home goes beyond this, reducing the potential damage to the structure itself and allowing homeowners to return to their regular lifestyle faster.
Resilient design can significantly reduce the inconvenience and financial losses that may result from extreme weather events and other hazards.
Crunch the numbers as early as possible
Using computer modelling programs can help optimise the design of a home – not only in terms of performance but in terms of cost. The biggest savings are often from decisions made early in the process.
Two pieces of research around Building Code requirements for thermal insulation provide good examples of this that may be applied to house design and construction more broadly:
- One industry group calculating potential additional costs of greater insulation requirements in H1/AS1 5th edition found the costs could be very modest – a little over $2,000 for a 3-bedroom house in climate zone 1 – if the calculation was factored in during the design phase of a project. In other words, costs can be lower if you sort the details early rather than later in the process.
- BRANZ analysis commissioned by MBIE found that using the modelling method in H1/VM1 to demonstrate Building Code compliance could give big savings – $2,318–15,071 – compared to manually using the tables in the H1/AS1 schedule method. (The higher costs and inflexibility around the schedule method were given as reasons for phasing out its use.)
While modelling is typically used to assess things like thermal performance, it can also be a big help in identifying potential cost savings.
Relocating an existing home
Another approach to achieving housing at a lower cost is buying a transportable home that is built off site or buying an existing house and moving it to a new site and finishing or renovating it. The New Zealand Heavy Haulage Association says that buying an existing house and relocating it to a new site can have an all-up cost of just two-thirds that of building new.