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20 February 2014

Affordable Housing: By What Definition?

mathew waters 38818 unsplash

Recently there has been much discussion in the media and within local and central government regarding the concept of 'affordable Housing'.

Rapidly becoming the holy grail in the world of residential housing, we are seeing political parties scrambling to solve the riddle, industry commentators gleefully pouring scorn on suggestions, suppliers getting targeted for higher material costs, and specifiers, designers and tradesmen continuing to battle through a bureaucratic minefield to gain consent for residential builds.

Launched last year, Labour’s Kiwibuild policy decreed $300,000 as the maximum allowable cost for an ‘affordable home’ and the policy aims to build 10,000 of these homes per year.  Both the targeted cost and pace of construction have been questioned but I believe there is a larger question we are missing altogether in the midst of this rabid search:

What is the lifecycle costing of these affordable homes?

Most of the debate I have observed so far focuses on the up-front cost as the definition of an affordable home, when in reality the lifecycle cost is of much more importance.  What use is a sub-$300,000 home if it only lasts 10 years before the cladding succumbs to the elements or the plumbing system starts to spring leaks?

An excellent example has occurred in the Christchurch rebuild, where the government has actively courted overseas plasterboard suppliers in a publicly-stated bid to reduce costs for this part of a home by 3%. Yet shouldn’t its objective have been to specify plasterboard with the best lifecycle costing?  In the high value commercial world where building durability and reducing ongoing maintenance costs is king, achieving the best possible lifecycle costing is a tried and true methodology of ensuring long-term profitability. This seems to have escaped us in the fragmented residential market yet the scale of both public and private residential construction being discussed for the next 10 years is on a distinctly commercial level.

I realise the prospect of even more up-front cost in exchange for long term savings is of little comfort to the first-time home buyer trying to secure a mortgage but changing the focus to lifecycle cost could open up all sorts of opportunities.  Instead of chasing 3% cost savings, how about incentivising a product with a 10% lower life-cycle cost?

At Marley we offer a 15-year guarantee on all our spouting and downpipe systems, 33% longer than most of our competitors.  Marley systems require only annual maintenance as compared to quarterly and are cost-competitive, but up-front cost still becomes the focus.

Watch this YouTube clip from the British Plastics Federation to see an excellent illustration of cost savings that can be achieved in a residential situation on a large scale.

View more information on Marley, including contact details.
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