The building industry in this country has been super heated over the last few years. Fueled by rapidly rising real estate prices, the subdivision of vast tracts of land and the availability of easy finance.

The cookie cutter building companies have done nothing for good tradesmanship, business prudence or quality of housing stock. They’ve cut prices through screwing down sub-contractors (who in turn cut corners on the projects), they’ve built to the very minimum standard the building code allows, and they have trimmed their own margins as tight as possible, relying on a high volume/low margin model.

The leaky building syndrome, while also having been caused by poor design, was in part caused by an eagerness to “build it quick/build it cheap. All this was encouraged by the anti-competitive and frankly nonsensical “master builders” federation (which is essentially a club with paid membership that says nothing about the skills of its members).

(Bear in mind I’m one of those people who, in time honoured New Zealand tradition, built his own house a few years ago – built I must say to a higher level than many of those “master built” houses)

So with all this it was interesting to read this morning that some building companies are cutting their prices by up to 50% in order to get some cashflow happening. We’ve already seen dozens of building companies go under in the last few months.

We’re seeing the start of a rationalisation – I only hope that at the end of this we’ll see a return to quality trademen building quality homes at realistic prices – that’s the only sustainable model there is.

And here’s what they can look at when done well, done with love, and done oneself…

Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

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