Fuel-heavy work like excavation rises, but trade rates edge up just 0.1%
Borrowers planning new builds face steady overall construction costs but sharper rises in fuel-heavy work like excavation, according to QV CostBuilder’s latest monthly update, released on 29 October 2026.
Across trades, prices barely moved, edging up 0.1% on average. That’s despite diesel prices climbing an average of 19% since QV’s previous monthly update, leaving them 76.2% above their February level. The update tracked more than 7,000 data changes across Auckland, Wellington, Christchurch, Dunedin, Hamilton, and Palmerston North.
Fuel pressure concentrated in earthworks
The impact of higher diesel prices is showing up most clearly in fuel-intensive work. Excavation costs rose 3.9% over the month, while piling and demolition each increased 0.6%.
QV CostBuilder quantity surveyor Martin Bisset said the diesel spike had not spread across the wider sector.
“This hasn’t directly translated into broad-based construction cost inflation,” he said in a media release, noting that many other material and trade rates had moved far more modestly.
Movement beneath a steady surface
At the product level, processed timber rose 6.2%, with medium-density fibreboard up 2.8%, reinforcing 2.7%, roofing and cladding 1.6%, and insulation 1.1%, while adhesives and sealants fell 4.2%, kitchen-related costs 1.2%, and structural timber 0.2%.
“Some products are moving up relatively sharply, some are coming back, and others are barely changing at all,” Bisset said. Taken together, he said, those shifts are largely offsetting one another.
The figures come as building activity picks up: 41,268 new homes were consented in the year to August 2026, up 21% on a year earlier, according to Stats NZ.
Budgeting for build projects
Bisset advised anyone planning construction work to keep allowing for cost movement, particularly on fuel-sensitive parts of a build.
“Where your costs will move most depends heavily on what you’re building, what materials you need, and how exposed the job is to fuel,” he said.
For mortgage advisers whose clients are on construction loans or planning major renovations, that points to the value of building contingency into project budgets, especially where significant earthworks or site preparation are involved.
The diesel surge is also showing up in the wider economy. The Reserve Bank of New Zealand, which held the official cash rate at 2.75% on 28 October, expects inflation to reach 4.4% in the December quarter, largely on fuel prices, though it noted early signs of a recovery in residential building.
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