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We are excited to present a remarkable new construction project! A subdivision project is all set to begin in  Christchurch. The total cost of the project is $625,000, which includes the cost of the land. The estimated construction time is 9 months. This project involves the construction of two separate houses, not a duplex, on a section that has been approved by the council for subdivision. Opportunities like this are incredibly rare! While one side of the house is already being built, we are looking for a builder to construct the other side. The reason we are able to offer such competitive pricing is by building both houses simultaneously. The potential for profit and equity gain upon completion is substantial, ranging from $115,000 to $200,000. We also offer financing options for this project.







From 2013 to 2023, there has been a significant shift towards multi-unit homes in New Zealand. The proportion of stand-alone houses decreased from 81% to 42% of newly consented dwellings, while the percentage of multi-unit homes increased from 19% to 58%. In the March 2022 quarter, the annual number of multi-unit homes consented exceeded stand-alone houses for the first time in the history of the data series. Over the past decade, the number of townhouses, flats, and units consented has more than tripled, rising from 3,550 in the year ended June 2013 to 26,031 in the year ended June 2023.

Construction costs in New Zealand are currently experiencing a slowdown, below long-term averages, due to the completion of building consents and the resolution of COVID-19-related supply chain disruptions. The latest data from CoreLogic's Cordell Construction Cost Index (CCCI) shows a 0.5% increase in construction costs in Q1 2024, significantly lower than the long-term average of 1.1%. The annual change in construction costs is 2.3%, the lowest rate in almost eight years. Chief Property Economist Kelvin Davidson explains that supply chain issues and increased construction activity in 2022 led to a spike in costs, but with supply chains normalized and construction activity decreasing, the pressure on capacity and cost growth has reduced. Most costs have remained stable since the end of 2023, providing relief from industry volatility and allowing builders to price jobs more accurately. While costs may not decrease, the expected annual growth rate of 3-4% in 2024 means they won't spike higher either.

Information sourced form https://www.corelogic.co.nz/news-research/news/2024/normalisation-of-nz-construction-costs-to-provide-certainty-for-builders-and-consumers

The property was acquired by the client for a sum of $1,180,000. The bank's valuation, however, stands at $1,440,000. Consequently, our client has achieved a remarkable profit or equity gain of $260,000. It goes without saying that he is exceedingly pleased with this outcome and is now looking at proceeding with the rebuilding process once all completd. Upon completion of the construction, he anticipates a substantial return on his investment, amounting to 18%, within an estimated timeframe of 9 months.

Images taken off a QV valuation of the property to be constructed 

1. Avoid increasing the land price with a margin: When entering into a construction project, it is important to ensure that the land price remains stable and does not increase with a margin. This can be achieved by conducting thorough research and due diligence before purchasing the land. By carefully analyzing market trends and negotiating with the landowner, it is possible to secure a fair and reasonable price for the land, without any additional markups. 2. Avoid inflating the material costs with a margin: Inflating material costs can significantly impact the overall budget of a construction project. To avoid this, it is crucial to establish transparent and fair pricing agreements with suppliers and contractors. By conducting regular market research and comparing prices from different vendors, it is possible to identify the most cost-effective options. Additionally, maintaining open communication with suppliers and negotiating bulk discounts can help prevent any unnecessary markups on material costs. 3. Provide a fixed price agreement: To ensure transparency and avoid any unexpected cost escalations, it is advisable to provide a fixed price agreement to clients. This agreement should clearly outline the total cost of the project, including all materials, labor, and any additional expenses. By providing a fixed price agreement, both parties can have a clear understanding of the financial obligations and avoid any disputes or misunderstandings in the future. 4. Include a 10-year Master Build Guarantee: Offering a 10-year Master Build Guarantee can provide clients with peace of mind and assurance regarding the quality and durability of the construction. This guarantee ensures that any defects or issues arising from the construction process will be rectified within the specified timeframe. By including this guarantee, clients can trust that the construction company stands behind their work and is committed to delivering a high-quality end product. This can also enhance the reputation and credibility of the construction company in the industry.