Calvin Davidson

do we actually see OCR increases coming back onto the table sooner than what we thought?

Yeah, so I mean, more of the same, really.

Construction costs still relatively flat.

I mean, they're going up a wee bit, but certainly not that post-COVID spike that we had.

So it was a 0.9% increase in the fourth quarter of the year.

This is across the cost to build a standard dwelling, I guess.

This is across wages, materials, and your professional fees, dwelling consent charges, that sort of thing.

So pretty standard sort of inputs.

Yeah, 0.9% across the quarter, 2.3% across the year.

Now, both of those are still below averages.

The long run annual increase is about 4%.

So yeah, 2.3%, let's call it sort of half the normal rate.

So yeah, costs still going up a wee bit, but below average, the actual level of costs is a lot flatter than it was certainly after COVID where we had

sort of a 10% spike, I think was the worst point in terms of construction cost increases.

So the plasterboard shortages, all of those things.

So yeah, we're still seeing costs go up a little bit, but not much.

And it fits with that wider downturn we've seen in the sector.

know capacities opened up a little bit so it all kind of fits that costs would be flatter but yeah i guess looking ahead there's there's reasons to think it might turn around a little bit i mean we've seen the construction sector in terms of workloads start to start to grow a little bit more um interest rates are down

lending rules incentivize new builds of course around the LVR and DTI limits so I think there's and the anecdotes around construction are a bit more positive too so I guess you know more activity this year builders getting a little bit busier you would anticipate that cost growth could accelerate a little bit as well but you know we're starting from a pretty low base I think maybe expectations around costs are just shift a little bit as well so you'd think it we might see a little bit more growth this year but return to that COVID spike seems pretty unlikely so yeah kind of more of the same really I think

Yeah, I mean, I guess you can spin it any way you want, I suppose.