Latest / Early Edition with Ryan Bridge / Malcolm Fleming: Certified Builders CEO on house building costs falling after more than a decade

Transcript

Malcolm Fleming: Certified Builders CEO on house building costs falling after more than a decade · Early Edition with Ryan Bridge

• 0:00
  Speaker 1: Right now, call logics called our Construction Price Index has
• 0:03
  Speaker 1: recorded the first drop in construction costs in twelve years
• 0:06
  Speaker 1: since the index started looking at prices. This should mean
• 0:09
  Speaker 1: that we get cheaper houses when we're building right Joining
• 0:13
  Speaker 1: me now is the new Zealand Certified Builders Chief executive
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  Speaker 1: Malcolm Fleming. Malcolm, what does it mean?
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  Speaker 2: Look? The drop in building us means it's a great
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  Speaker 2: time time for home book owners to consider a building project.
• 0:27
  Speaker 2: Global supply chains are no longer disrupted, so costs are
• 0:31
  Speaker 2: returning to where they were pre pandemic and falling demand
• 0:34
  Speaker 2: for building materials has led to manufacturers and distributives becoming
• 0:39
  Speaker 2: more competitive with they're product pricing. So home ruwners can
• 0:42
  Speaker 2: now be more discerning about the builder engage to set
• 0:46
  Speaker 2: their building project up for success. Home owners would be
• 0:49
  Speaker 2: insisting on a trade qualified builder is aligned to the
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  Speaker 2: Trade association because they have a choice.
• 0:54
  Speaker 1: Now, what does it mean for trade's wages? Are they
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  Speaker 1: going down or are they just not rising at the
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  Speaker 1: same rate?
• 1:02
  Speaker 2: Wages generally have stabilized four point one percent was the
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  Speaker 2: last on that in terms of statistics, there has been
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  Speaker 2: a slow down and the wage rises generally a constant sector.
• 1:15
  Speaker 2: Material costs are coming down, as we've just been talking about,
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  Speaker 2: and part of an example of that is manufacturers and
• 1:22
  Speaker 2: disputed distributors of building products are becoming more competitive. So
• 1:27
  Speaker 2: in action, what we're seeing is merchants approaching our members
• 1:31
  Speaker 2: about opening your accounts with them at attractive pricing, and
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  Speaker 2: that's something we never saw costs twenty and twenty twenty two.
• 1:39
  Speaker 1: This is all good news. Does this mean that we're
• 1:41
  Speaker 1: going to see cheaper that you first into the first
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  Speaker 1: homes or new homes cheaper?
• 1:48
  Speaker 2: I think we're going to see some of those costs
• 1:50
  Speaker 2: coming through. Another driver behind this as well as subcontractor
• 1:55
  Speaker 2: margins are under pressure as demand is for so subcontractor
• 1:59
  Speaker 2: margins are a lot higher and more elastic than a
• 2:01
  Speaker 2: builder's margin, and downward movement in that space has an impact,
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  Speaker 2: and that's what we're starting to see now. So again,
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  Speaker 2: a really good time for the homeland and consider a
• 2:10
  Speaker 2: building project.
• 2:10
  Speaker 1: Malcolm, Thanks for your time. Malcolm Fleming with us this morning,
• 2:13
  Speaker 1: the New Zealand Certified Builders Chief Executive.
• 2:16
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