Here at Box™ we’re slightly obsessive about the cost of building.
We have plenty of experience building quality homes on easy and difficult sites over the last 15 years and have heaps of data! Margins are enough for us to run a business sustainably and responsibly, and we are (in our accountant’s opinion) highly competitive.
Yet we often struggle to get clients who have never built a house before, to trust us with the ‘numbers’. It’s hardly surprising since there is so much incomplete or misleading information on the internet about what it costs to build a unique house on empty site.
Give me the numbers!
So to feed my obsession and give me more psychological angst I thought I’d ask GPT’s new 4o brain to give me its view. I asked it a rather broad question:
“What does it cost to build an architecturally designed house in New Zealand as a total project cost including all fees, consultants, designers, builders and give me a breakdown”.
At first it came up with the rather broad and misleading blanket statement (with obligatory get-out-of-jail’ clause):
GPT: “The average cost per square meter for an architecturally designed house in New Zealand ranges from NZD $3,500 to $5,500, though high-end or complex projects can exceed this range.” (cue pangs of stress and increase in blood pressure…)
However, it then proceeded to give me a more useful project breakdown:
GPT: Example Calculation for a 200 Square Meter House
Assuming an average cost of NZD $4,500 per square meter:
- Design and Planning:
- Architectural Fees: 10% of NZD $900,000 = NZD $90,000
- Consultants: NZD $20,000
- Consent Fees: NZD $10,000
- Construction Costs:
- Building Costs: 200sqm * NZD $4,500 = NZD $900,000
- Project Management Fees: 7% of NZD $900,000 = NZD $63,000
- Contingency: 7% of NZD $900,000 = NZD $63,000
- Site Preparation:
- Earthworks and Foundation: NZD $50,000
- Utilities: NZD $20,000
- Interior Fit-Out:
- Kitchens and Bathrooms: NZD $100,000 (2 bathrooms, 1 kitchen)
- Flooring, Painting, and Decorating: NZD $75,000
- Exterior and Landscaping:
- Exterior Cladding and Roofing: NZD $100,000
- Landscaping and Driveways: NZD $30,000
Total Cost Estimate
- Design and Planning: NZD $120,000
- Construction Costs: NZD $1,026,000
- Site Preparation: NZD $70,000
- Interior Fit-Out: NZD $175,000
- Exterior and Landscaping: NZD $130,000
Total Estimated Cost: NZD $1,521,000
Where do the numbers come from?
So, as is typical for the industry and most industry commentators, GPT had failed to calculate that the average cost to build a house should also include site preparation, utilities, fit-out, driveway and pre-construction costs!
Overall, the figure for what we call at Box a ‘Total Project Cost’ comes out at ~$7,500/sqm, which is roughly what we experience, depending on site characteristics and the cost of utilities (not including wastewater systems, water tanks, solar power, etc.).
I could pick at a few details: low consultant and consent fees (building consents are between $14k and $18k in Auckland); high project management cost – but this is calculated against the build cost not including siteworks, exteriors and other important bits of the build; site preparations we often see in the 100’s of thousands, particularly on large or sloping sites where there is substantial site cut, retaining walls and long driveways. But ultimately it’s the bottom line that matters.
So where are these numbers coming from? I asked GPT to reference its sources. These included Canstar, mortgages.co.nz, Archipro, Wise Move, Costbuilder, Arcline and Bing. Disappointed to see Box was not in there as a reputable source given our obsession!
Of course there was the usual caveat:
GPT: “The cost to build an architecturally designed house in New Zealand can vary widely based on factors such as location, design complexity, materials, and site conditions.”
So I decided to enquire about my other obsession, the cost to build on Waiheke Island!
GPT: “Overall, building on Waiheke Island can be significantly more expensive, potentially adding about 30-40% to the total project cost compared to building in Auckland.
Yes it is more expensive to build on the island, but our date shows a 20% to 30% increase, including siteworks where wastewater systems and tricky driveways are often required.
A recent Box ™ build project in Kerikeri.
How does this square up with Box™?
When clients initially come for a workshop to discuss their project I often do a high-level breakdown of costs based on their site and my understanding of their brief. My structure is the following for Auckland projects:
- Pre-construction (consents, design consultants): 10%-12%
- Siteworks (site clear, cut, retaining walls, access, drainage, water tanks etc): $150k – $400k
- House build $4,500 – $5,500 per sqm
- External works (decks, pergolas, pool etc): $50k – $200k
- Contingency $50k – $100k
So this gives $1.5m – $2m for 200sqm depending on design scope, site, project complexity and if a pool is included! Not a million miles away from GPT.
The bottom line is that building the home of your dreams is of course, very exciting and fun thing to do, but starting with realistic cost expectations is paramount. If you are considering a project, we’re always happy to have a no obligation chat about your ideas, the site and to workshop those dreaded numbers!
