Auckland Renovation Industry

Navigating New Zealand’s Renovation Industry: Key Trends, Challenges, and Tips for Homeowners – 2024

If you’ve been keeping an eye on the construction and renovation scene in New Zealand, you know it’s been a wild ride lately. Whether you’re planning a major home upgrade or just curious about the market, it’s crucial to stay informed about the latest trends and challenges. We’ve sifted through the latest articles from NZ Herald, Stuff, RNZ, and 1 News to bring you the most important insights. Let’s dive into what’s been happening and why it matters for you.

In this article, we’ll explore:

  1. Overall Consensus: What’s the big picture in the industry right now? We’ll talk about the major challenges like economic slowdowns, labor and material shortages, and new government regulations. Understanding these factors will help you make informed decisions about your renovation projects.
  2. Common Trends: The industry is evolving with some exciting trends, such as sustainable building practices, the integration of new technologies, and a strong focus on affordable housing. These trends not only affect the industry but also offer new opportunities and solutions for homeowners.
  3. Future Outlook: What does the future hold? We’ll discuss the expected economic uncertainties and how they might impact your renovation plans. Plus, we’ll look at how resilience and new policies might shape the industry moving forward.

Why Is This Important?

Staying up-to-date with these developments is crucial for several reasons:

  • Planning and Budgeting: Knowing about current trends and potential future changes helps you plan your projects more effectively and budget wisely.
  • Avoiding Pitfalls: Understanding the challenges can help you avoid common pitfalls like unexpected delays or cost overruns.
  • Making Informed Choices: Being aware of new technologies and sustainable practices allows you to make choices that are not only good for your home but also for the environment.

By the end of this article, you’ll have a comprehensive understanding of the current state of the renovation and construction industry in New Zealand, the trends shaping it, and what you can expect in the near future. Whether you’re a homeowner looking to renovate or someone simply interested in the market, these insights will equip you with the knowledge to navigate the industry’s complexities. Let’s get started!


Key Trends and Insights from the news

We had a look at some of the articles from NZ Herald, Stuff, RNZ, and 1 News, here is the overall consensus and common trends we noticed about the renovation and construction industry in New Zealand over the past six months:

Overall Consensus

  1. Challenges and Slowdown:
    • The industry has faced significant challenges, primarily due to the economic impacts of inflation and increased interest rates. This has resulted in reduced consumer spending on large-scale renovations and new constructions .
  2. Labour and Material Shortages:
    • Ongoing shortages of skilled labor and construction materials have exacerbated delays and increased costs. The shortages are a continuation of issues that began during the COVID-19 pandemic and have yet to fully resolve .
  3. Government and Regulatory Changes:
    • There have been several regulatory changes aimed at easing the housing crisis, including alterations to zoning laws to allow for higher-density housing. These changes are intended to stimulate the construction of new homes, particularly in urban areas .

Common Trends

  1. Sustainability and Green Building:
    • There is a growing trend towards sustainable and energy-efficient building practices. This includes the use of eco-friendly materials and designs that minimize environmental impact. Builders and consumers alike are showing increased interest in green building certifications and energy-efficient home features .
  2. Technological Integration:
    • The adoption of new technologies, such as Building Information Modeling (BIM), virtual reality, and drone surveying, is becoming more prevalent. These technologies are helping to streamline project management, reduce costs, and improve accuracy in construction .
  3. Focus on Affordable Housing:
    • Addressing the housing affordability crisis remains a key priority. There has been a concerted effort by both the government and private sector to increase the supply of affordable housing. This includes not only new builds but also the renovation of existing properties to make them more affordable .

Outlook for the Future

  1. Continued Economic Uncertainty:
    • The industry is expected to continue grappling with economic uncertainties. High interest rates and inflation are likely to persist, potentially dampening growth in the short term. However, there is cautious optimism that as these economic pressures ease, the market will stabilize .
  2. Increased Focus on Resilience:
    • Future construction projects are likely to emphasize resilience against natural disasters and climate change. This includes incorporating design features that enhance durability and safety, particularly in regions prone to earthquakes and extreme weather .
  3. Policy and Incentives:
    • There is potential for new policies and incentives to further support the construction industry. This could include tax incentives for sustainable building practices, grants for affordable housing projects, and initiatives to attract more workers to the industry .

The renovation and construction industry in New Zealand is currently navigating a challenging landscape marked by economic pressures, material and labor shortages, and regulatory changes. However, trends towards sustainability, technological integration, and a focus on affordable housing are driving innovation and resilience. The outlook suggests a period of adjustment and potential stabilization as economic conditions improve and new policies are implemented.


What Are The Numbers Saying? We take a look at the Stats

Increased Renovation Activity

The residential renovation sector in New Zealand has been buoyant, with many homeowners opting to upgrade their properties. This surge is partly due to the increasing cost of buying new homes, making renovations a more appealing option for improving living spaces. As per the NZ Herald, there has been a marked increase in both minor and major renovation projects across the country.

Impact of Economic Factors

Several economic factors have influenced the renovation industry:

  1. Consumer Spending: Consumer spending in New Zealand has generally been robust, supporting higher expenditure on home renovations. The NZ Herald highlights that even amid economic uncertainties, many households prioritize spending on improving their homes.
  2. Gross Domestic Product (GDP): The GDP growth in New Zealand has correlated positively with the renovation industry. A healthy economy typically boosts consumer confidence, leading to more spending on home improvement projects.
  3. Inflation: Rising inflation has had a mixed impact. On one hand, higher costs for materials and labor have increased the overall cost of renovations. On the other hand, it has prompted some homeowners to renovate sooner rather than later, anticipating further price hikes.
  4. Interest Rates: The fluctuation of interest rates has significantly affected renovation lending. Lower interest rates over recent years have made borrowing more affordable, encouraging homeowners to finance their renovation projects through loans. However, as interest rates begin to rise, this trend could potentially slow down.
  5. Official Cash Rate (OCR): Changes in the OCR set by the Reserve Bank of New Zealand have influenced mortgage and loan interest rates. Lower OCRs in recent years have supported the affordability of loans for renovations, but any future increases might dampen this effect.

Correlations and Concerns

The renovation industry shows strong correlations with broader economic conditions. Consumer confidence and spending patterns directly impact the volume of renovation projects. Economic stability encourages more significant investments in home improvements, while economic downturns or increased costs can lead to caution among homeowners.

One notable concern for both companies and individuals considering renovations is the potential for rising costs. As reported by the NZ Herald, supply chain disruptions and increased demand for materials have driven up prices, which could deter some homeowners from embarking on extensive renovations. Additionally, the prospect of higher interest rates may make financing these projects more expensive, potentially slowing down the industry’s growth.

Key Areas for Concern

For companies in the renovation industry, maintaining a balance between competitive pricing and profitability is crucial amidst fluctuating material costs and labor shortages. Homeowners, on the other hand, need to carefully consider the timing of their projects and secure financing options that will remain affordable even if interest rates rise.

Overall, the New Zealand residential renovation industry remains vibrant, with positive growth trends supported by strong economic factors. However, careful attention to economic indicators and strategic planning will be essential for navigating future challenges.


What’s Been Happening?

Over the past five years, New Zealand’s residential renovation scene has seen quite a few ups and downs.

  1. Building Consents:
    • Imagine the flurry of activity in 2021 and 2022 when heaps of people were getting their building consents sorted. Then, in 2023, things slowed down a bit, with about 45,159 new dwellings getting the green light. That’s 11% less than the previous year​ (Stats NZ)​.
    • The amount of building work, especially for homes, kept climbing. By mid-2022, the volume of residential construction work was up by 3.2% compared to earlier in the year​ (Stats NZ)​.
  2. Rising Costs:
    • One big headache has been the rising costs. Whether it’s lumber, concrete, or labor, everything’s getting pricier. Supply chain issues, which were made worse by the pandemic, have been a major factor here​ (Stats NZ)​.
  3. Housing Market Trends:
    • The housing market itself has been all over the place. While more homes were being built, the actual rate per 1,000 residents started dipping. So, even though more consents were being issued, it wasn’t quite keeping up with population growth​ (Stats NZ)​​.


Building Consents Statistics (past five years)

Building_consents_issued_for_new_residential_buildings_in_New_Zealand, Kitchen Renovation, Bathroom Renovation, House Renovation Auckland

Description: This table summarizes the fluctuation in building consents over the past five years, indicating trends in residential construction activity.


What’s the Big Deal?

  1. Economic Uncertainty:
    • The economy has a big say in how much renovating people do. When times are tough or uncertain, like during the COVID-19 pandemic, folks are less likely to dive into big renovation projects because of financial worries.
  2. Material and Labor Shortages:
    • The link between global supply hiccups and rising costs is pretty clear. When materials are hard to come by or more expensive, it jacks up the overall cost of renovation projects.
  3. Regulations:
    • Tighter building regulations mean more hoops to jump through, which can make renovations more expensive and complicated.


Impact of Economic Factors on Renovation Industry

Economic Factor Impact on Renovation Industry
Consumer Spending Supports higher spending on home improvements, even during economic uncertainties.
GDP Growth Correlates positively with increased consumer confidence and spending on renovations.
Inflation Increases costs for materials and labor, prompting earlier renovations to avoid higher expenses.
Interest Rates Lower rates make borrowing affordable, stimulating renovation activity.
Supply Chain Disruptions lead to increased costs and project delays due to material shortages.



What Should You Watch Out For?

  1. Budget Blowouts:
    • With costs climbing, budget overruns are becoming a real issue. This can be a huge strain for homeowners and lead to projects that are left hanging or unfinished.
  2. Market Fluctuations:
    • The number of building consents going up and down suggests the market is a bit unpredictable. Companies need to stay nimble to keep up with these shifts.
  3. Availability of Resources:
    • Shortages in labor and materials not only bump up costs but can also delay projects, which is a headache for both contractors and homeowners.


The impact of overseas imports of building supplies and materials on New Zealand’s residential renovation industry has been significant, particularly in terms of costs and delays. The construction sector has faced substantial challenges due to supply chain disruptions, which have been exacerbated by global events and logistical issues.

One of the key issues is the rising cost of imported building materials. Due to a combination of high international demand, shipping constraints, and tariffs, the prices for essential construction supplies have surged. For example, according to a report in the NZ Herald, the cost of timber, a critical material in residential construction, has skyrocketed, significantly affecting the overall cost of renovations in New Zealand. This price hike is a result of both global shortages and increased shipping costs.

Moreover, delays in the delivery of these materials have been another major concern. The pandemic has caused significant disruptions to global supply chains, leading to prolonged delivery times. Builders and renovators in New Zealand have frequently faced project delays due to these extended shipping times. The NZ Herald highlighted instances where projects have been stalled for months waiting for essential materials to arrive, causing frustration for both contractors and homeowners.

The combined effect of increased costs and delays has had a ripple effect throughout the renovation industry. For companies, the unpredictability of material costs and availability has made it challenging to provide accurate quotes and timelines to clients, which can strain client relationships and affect business reputations. For homeowners looking to renovate, these issues have translated into higher project costs and longer wait times, sometimes leading to the postponement or scaling back of planned renovations​.

Addressing these supply chain challenges requires a multifaceted approach, including diversifying supply sources, improving local production capabilities, and better managing project timelines to account for potential delays. Companies and individuals planning renovations should stay informed about these ongoing issues and adjust their plans and budgets accordingly to mitigate the impact of these external factors on their projects.


Tips for Homeowners and Companies

For homeowners thinking about renovating:

  • Plan for Higher Costs: Expect prices to go up and build a buffer into your budget.
  • Be Ready for Delays: Projects might take longer than expected due to resource shortages.
  • Hire Experienced Contractors: They can navigate these challenges better and keep your project on track.

For renovation companies:

  • Stay Flexible: Have plans that can adapt to changing costs and supply issues.
  • Communicate Clearly: Keep your clients in the loop about potential delays and cost changes to manage their expectations.
  • Optimize Resources: Look for alternative suppliers and manage your resources efficiently to keep things moving smoothly.


What shifts/trends are we noticing in renovations?

When diving into specific trends within New Zealand’s residential renovation industry, several key areas have shown notable demand over recent years. Here’s a breakdown of what homeowners are prioritizing:

  1. Full House Renovations: Comprehensive renovations are increasingly popular, especially among those purchasing older homes or looking to modernize their living spaces significantly. These projects often aim to improve energy efficiency and update outdated interiors, reflecting a growing trend towards sustainable living and modern aesthetics.
  2. Outdoor Renovations: The pandemic has heightened interest in creating functional outdoor living spaces. Homeowners are investing in decks, patios, and gardens to enhance their home’s usability and aesthetic appeal. The inclusion of outdoor kitchens and entertainment areas has also seen a surge as people seek to maximize their property’s potential for hosting and leisure​.
  3. Bathroom Renovations: Bathrooms remain a top priority for renovations due to their high use and impact on home value. Updates often include installing new fixtures, improving storage with custom cabinetry, and enhancing overall aesthetics with modern tiling and lighting solutions.
  4. Kitchen Renovations: Kitchens are frequently renovated to improve functionality and incorporate modern design elements. Popular updates include custom cabinetry, new countertops, energy-efficient appliances, and better lighting. The trend towards open-plan kitchen designs continues to gain traction, aligning with the broader movement towards more communal and versatile living spaces.
  5. Design Services: As homeowners aim for personalized and unique spaces, there’s a growing demand for professional design services. These services help tailor renovations to individual tastes and ensure a cohesive aesthetic throughout the home. The involvement of designers is particularly noticeable in high-end renovations where bespoke solutions are a priority.
  6. Maintenance Services: Regular maintenance has become essential, particularly in older homes. Services such as roofing, plumbing, and electrical updates ensure safety and efficiency, preventing costly repairs in the future.
  7. Flooring: Upgrading flooring is a common renovation project, with many opting for durable, easy-to-maintain materials like hardwood, laminate, or high-quality tiles. This trend reflects a desire for long-lasting, aesthetically pleasing solutions that enhance the overall look and feel of a home.
  8. Painting Services: Interior and exterior painting remain popular as they offer a relatively affordable way to refresh a home’s appearance. Professional painting services are often sought to ensure high-quality finishes and the latest color trends are applied correctly.
  9. Consent Related Renovations: Renovations requiring council consent, such as structural changes or additions, are steadily rising. These projects tend to be more complex and involve extensive planning and compliance with local regulations.
  10. Designer/High-End Renovations: There’s a significant market for high-end renovations that focus on luxury and bespoke elements. These projects often include custom-built furniture, high-quality materials, and cutting-edge technology to create unique, sophisticated living environments.

Overall, the demand for renovation services in New Zealand is diverse and reflects a broader trend towards enhancing both the functionality and aesthetics of residential properties. Homeowners are increasingly willing to invest in their living spaces, driven by a desire for comfort, efficiency, and personal expression.


Our Most Popular Types of Renovation Projects this Year

Type of Renovation Description
Full House Renovations Comprehensive updates to older homes for modernization and energy efficiency.
Outdoor Living Spaces Investments in decks, patios, and gardens for enhanced outdoor living.
Bathroom Renovations Updates include new fixtures, storage solutions, and modern aesthetics.
Kitchen Renovations Focus on functionality with new appliances, countertops, and open-plan designs.
Design Services Utilization of professional designers for personalized and cohesive aesthetics.

Description: This table highlights the types of renovation projects popular among homeowners in New Zealand, reflecting current trends and preferences.


Here are some tips and advice for homeowners:

Choosing the right renovation company in the current economic climate requires careful consideration and strategic planning.

Research and Recommendations

  • Seek Recommendations: Start by asking friends, family, and neighbors for recommendations. Personal experiences can provide valuable insights into a company’s reliability and quality of work.
  • Online Reviews: Check online reviews on platforms like Google, Facebook, and trade-specific sites. Look for consistent positive feedback and note how the company responds to any negative reviews.

Check Credentials and Experience

  • Licensing and Insurance: Ensure the company is properly licensed and insured. This protects you from any liability in case of accidents or damages during the renovation process .
  • Experience and Specialization: Choose a company with extensive experience, especially in the type of renovation you are planning. A company specializing in kitchen renovations, for example, will have different expertise compared to one that focuses on outdoor projects.

Request Detailed Quotes

  • Multiple Quotes: Obtain quotes from at least three different companies. This allows you to compare pricing and services offered. Be wary of quotes that are significantly lower than others; they might be cutting corners or may include hidden costs .
  • Detailed Breakdown: Ensure the quotes include a detailed breakdown of what it includes, labor, materials, and any additional fees. This transparency helps avoid unexpected expenses later on .

Evaluate Communication and Professionalism

  • Initial Interaction: Pay attention to how promptly and professionally the company responds to your initial inquiries. Good communication is crucial throughout the renovation process .
  • Project Management: Ask about their project management process. A company that provides a dedicated project manager can streamline communication and coordination, ensuring the project stays on track .

Assess Past Work

  • Portfolio Review: Review the company’s portfolio of completed projects. This gives you a sense of their style, quality of work, and attention to detail.
  • References: Request references from previous clients and take the time to contact them. Hearing about their experiences can give you confidence in your choice .

Understand Contracts and Warranties

  • Clear Contract: Ensure the company provides a clear, comprehensive contract that outlines the scope of work, timelines, payment schedules, and terms. Avoid companies that are unwilling to provide a written agreement .
  • Warranties and Guarantees: Inquire about warranties on both labor and materials. A company that stands behind its work will offer warranties, giving you peace of mind regarding the longevity and quality of the renovation.

Financial Stability

  • Economic Stability: Consider the financial stability of the company. Established companies with a stable financial background are more likely to complete the project without issues related to budget shortfalls. This might be a bit harder to get information on, but you can ask how many projects do they have running at the moment and what their working capacity is like to get a gauge on their volume/ availability. Some companies may also provide a letter of assurance (from their accountant) to confirm their financial viability/sustainability.

Flexibility and Adaptability

  • Adaptability: In the current economic climate, flexibility is key. Choose a company that can adapt to changing circumstances, such as supply chain disruptions or fluctuating material costs.
  • Contingency Planning: Discuss contingency plans for potential delays or unexpected issues. A proactive approach can prevent minor issues from becoming major setbacks .


So there you have it! The renovation and construction industry in New Zealand is navigating some choppy waters, but it’s also brimming with exciting opportunities. Whether you’re dreaming of a full house makeover or just sprucing up your kitchen, being aware of the current trends and challenges can help you make smarter decisions.

Remember, the industry is dealing with economic pressures, labor and material shortages, and changing regulations. But on the flip side, trends like sustainability, technological integration, and a focus on affordable housing are driving innovation and resilience.

As we look ahead, there’s a mix of cautious optimism and the need for adaptability. The future might bring more economic uncertainties, but also new policies and incentives to support the industry.

If you’re planning a renovation, make sure to do your homework, plan for potential hiccups, and consider seeking advice from experts. And most importantly, enjoy the process of transforming your home into the space you’ve always wanted.

Thanks for reading, and happy renovating!


Note: The information provided in this article is based on our perspective as a renovation company (Superior Renovations) and is limited to our knowledge of the renovation and construction industry in Auckland and New Zealand. We are not financial advisors or economists, and the insights shared here are for informational purposes only. We strongly recommend that readers seek professional advice from qualified experts before making any financial decisions related to renovations or construction projects.


What factors are driving the surge in residential renovations in New Zealand?

Homeowners increasingly opt for renovations due to soaring housing costs, making upgrading existing properties more appealing financially.

How has consumer spending impacted the renovation industry in New Zealand?

Robust consumer spending has supported higher investment in home improvements despite economic uncertainties, as reported by the NZ Herald.

What role does GDP growth play in the New Zealand renovation sector?

Positive GDP growth correlates with increased consumer confidence and higher spending on home renovation projects.

How has inflation affected the residential renovation industry in New Zealand?

Rising inflation has led to higher costs for materials and labor, prompting some homeowners to renovate sooner to mitigate future price increases.

How have supply chain disruptions affected the cost and timeline of renovation projects in New Zealand?

Supply chain disruptions, exacerbated by global events, have driven up material costs and caused delays, significantly impacting project budgets and timelines.

What are the key trends in types of renovation projects being undertaken in New Zealand?

Comprehensive renovations, outdoor living spaces, and updates to kitchens and bathrooms are among the popular renovation trends driven by modernization and sustainability

What should homeowners watch out for in the current renovation market?

Homeowners should anticipate budget overruns, market fluctuations in building consents, and potential delays due to shortages in labor and materials.

How can homeowners choose the right renovation company amidst economic uncertainties?

Researching credentials, checking reviews, obtaining detailed quotes, and assessing past work are crucial steps to ensure quality and reliability.



If you’re looking for “specific” cost estimates, try our Renovation Cost Calculator Tools


Need more information?

Take advantage of our FREE Complete Home Renovation Guide (48 pages), whether you’re already renovating or in the process of deciding to renovate, it’s not an easy process, this guide which includes a free 100+ point check list – will help you avoid costly mistakes.

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