WHAT WAS CLAIMED
Changes to the National Construction Code added $60,000 to the cost of building a home.
OUR VERDICT
False. Figures provided by the coalition as evidence do not support the claim.
AAP FACTCHECK - Coalition frontbenchers say new standards have added $60,000 to the cost of building a home, but the evidence they provide doesn't support the claim.
The Liberals and Nationals have cited a construction lobby group's analysis of a rise in the average value of new home building approvals in Sydney, which factored in materials and labour costs in addition to the new standards.
The National Construction Code (NCC), a set of standards with which new houses in Australia must comply, was updated in 2022 to include 7-star energy ratings.
Nationals leader David Littleproud called the change "construction code madness" in a Sky News Australia interview on February 17.
"This government now has a seven-star construction code adding $60,000 to the construction of a home," Mr Littleproud said.
Michael Sukkar (left) and Peter Dutton have both cited the $60,000 figure. (James Ross/AAP PHOTOS)
Opposition Leader Peter Dutton made the same claim in a press conference in October 2024, while opposition housing spokesman Michael Sukkar repeated the claim in an interview with Canberra's 2CC Radio.
"For the government just to whack on $60,000 of additional charges, really for regulations that don't mean you've got a home at the end that's worth $60,000 more," Mr Sukkar said.
When asked for their evidence, Mr Littleproud and Mr Sukkar's offices told AAP FactCheck the figure came from Master Builders Australia.
They provided a table detailing the calculations based on Australian Bureau of Statistics data.
The coalition figures also pointed to the Daily Telegraph reporting the Master Builders analysis, and the lobby group's chief executive Denita Wawn speaking about the $60,000 calculation in a Sky News Australia interview.
Liberal MP Michael Sukkar supplied a table showing new home building approval values in Sydney. (AAP/Master Builders Australia)
The table in the analysis compared average values of new home building approvals in Greater Sydney between the December quarter in 2022 and the same period in 2023.
It did not specifically assess cost increases related to changes in the National Construction Code; it measured changes to overall home building costs across the city.
When asked what had caused the cost increases in the interview, Ms Wawn said it was a combination of labour shortages, rising materials costs and regulation.
Master Builders confirmed that its public comments about home building costs took into account more than just regulations.
"When we talk about cost increases to housing we talk generally around what causes cost increases in building and construction, which includes regulation (NCC included), skills shortages, material costs," a spokesperson told AAP FactCheck.
Estimates of how much the 2022 code changes would add to building costs have varied.
Master Builders Queensland estimated in 2023 that the cost of complying with the updated code in the state would be between $20,000 and $30,000, depending on factors such as the type of construction, property size and location's topography.
The Housing Industry Association, which opposed the code changes, estimated they would add $25,000 to home building costs nationally in an Australian Financial Review report.
Estimates published by The Australian Glass and Window Association, which supported the code changes, ranged between $2972 in Brisbane to $5905 in Melbourne.
Estimates of how much the code changes would add to building costs varied ahead of the updates. (Joel Carrett/AAP PHOTOS)
Economics consultants ACIL Allen also published estimates in a regulatory impact statement prepared for the Australian Building Codes Board when it was consulting on the code changes.
It predicted (Page XVIII) capital costs ranging between $464 and $7830 nationally, depending on house type and location, and forecast energy bill savings between $630 and $9693.
Trivess Moore, a construction expert at RMIT University, said the coalition's cited evidence didn't substantiate the $60,000 claim.
"[The] $60,000 figure doesn't really pass the pub test," Associate Professor Moore told AAP FactCheck.
He said the industry had consistently overestimated the costs imposed by building code changes over the years.
Michael Ambrose, a CSIRO expert in residential energy efficiency, pointed to a 2013 study that found that compliance with five-star energy standards had reduced home building costs in Melbourne, Brisbane and Adelaide (Page 69).
While he did not expect costs to fall due to changes to the code in 2022, Mr Ambrose said he had "not seen any rigorous study that has confirmed the $60,000 increase claim and doubt one exists".
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