There's a "long way" to go before construction prices are back to pre-Covid-19 levels, but the year on year average price increase appears to be getting smaller.

In QV Costbuilders latest report, the average yearly increase in cost of building a home in New Zealand's main centres is 11.3 per cent.

This is down from 20.9 per cent reported in QV's May 2022 update.

QV Costbuilder spokesperson and quantity surveryor Martin Bisset says it appears as though rapidly rising construction costs "may finally be levelling off now" however there's "still a long way to go" before New Zealand sees the stable prices "we saw pre-pandemic".

'In the meantime, supply chain issues are reducing, but is still likely to be an issue with products from China, which still has strict COVID-19 policies in place," says Martin.

"Inflation also remains rife, both at home and abroad, with all associated costs from rising interest rates likely to continue to be passed on to consumers. Prices are likely to continue to rise as a result, albeit not at the rapid rates we've seen over the last couple of years.”

The biggest elemental price increases since QV CostBuilder's last update in May 2022 related to framing, which went up 9.5 per cent due to the increasing cost of precast concrete, reinforcing and structural steel.

Costs related to exterior walls and exterior finish went up 7.7 per cent, and the cost of upper floors and stairs and balustrades went up 7.4 per cent and 6 per cent respectively.

On average, each trade rate has increased by 4.6 per cent since May 2022, with drainage up 9.2 per cent. The cost of fire proofing increased by an average of 8.9%, with plasterboard linings, 8.6 per cent, carpentry 8.4 per cent, and hardware 7.8 per cent, rounding out the top five price increases since QV CostBuilder's last update.

This represents a 3.9 per cent increase in the price to build non-residential buildings and a 5.5 per cent increase in the cost to build residential buildings since May 2022. The average price of building a non-residential building increased by 8.9 per cent year-on-year.

'It's important to remember these figures are averages and the cost of building will always be dependent on the level of finishes, internal layout, and all manner of other elements, including whether or not it has a single or double garage,” says Martin.

For more information on QV CostBuilder, visit costbuilder.qv.co.nz.