Fuel savings flow through to excavation rates, but experts warn stability may not last
The message from QV is one of cautious optimism rather than confidence in a lasting trend.
QV CostBuilder spokesperson and quantity surveyor Martin Bisset flagged that fuel markets remain exposed to global shocks, noting recent oil-market swings "are a reminder that things can change quickly, especially while the situation in the Middle East remains so fluid."
Bisset said QV would continue monitoring the data closely, adding that "it remains to be seen whether that stability will last."
Fuel savings flow through to trades
New Zealand's construction costs held broadly steady for a second straight month in July, according to the latest QV CostBuilder update, as a sharp fall in diesel prices offset rises elsewhere in the sector.
Diesel dropped 20.7% month-on-month, easing pressure on fuel-intensive trades — particularly excavation, which posted the largest average reduction of any trade for the second month running, down 4.5%.
Bisset said the fall in diesel between June and July had flowed directly through to trades most exposed to fuel costs. Excavation was the standout beneficiary, he said, because it "relies heavily on machinery and transport, so when diesel falls, that tends to show up in the numbers pretty much straight away."
The steadier cost backdrop lands alongside fresh Stats NZ figures, released the same day, showing annual consent numbers topped 40,000 for the first time since 2023 — though Westpac noted consents actually eased 4% in June itself, meaning the underlying pace of new building remains uneven even as costs settle.
Not all rates are falling
The headline stability masks considerable movement underneath. Of the roughly 9,600 price changes tracked in this month's update, several trades posted increases rather than falls. Concrete blockwork rose 0.8% and concrete itself lifted 0.9%, while sharper gains were recorded in expanded polystyrene sheet (up 9.3%), Aquatherm pipework (up 7.5%), copper pipework (up 4%), ready mixed concrete (up 3.7%) and wool insulation (up 3%).
Bisset noted that while the overall number looks steady, there is still noticeable movement beneath the surface.
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