A $27 billion repair bill is hiding inside every house sale

Alex Harman thought she had bought a two-bedroom duplex in Onehunga. In June her building inspector told her she had also bought a $14,000 roof replacement. Her experience is not bad luck. It is the norm in a housing stock that has been quietly falling apart while prices did the talking.

New research from the Centre for Research Evaluation and Social Assessment (CRESA) now recommends buyers set aside a 2% remediation and maintenance buffer on top of the purchase price. CRESA director Dr Kay Saville-Smith puts the problem bluntly: “The maintenance cost over the life cycle of the dwelling is largely ignored.” On an $850,000 house, that buffer is $17,000 that appears in no loan approval, no valuation and no agent’s marketing copy.

Nine in 10 homes need work now

The scale is not in dispute. In March 2026, CRESA research backed by the Building Research Levy found about 90% of homes needed immediate maintenance, with the bill estimated at $27 billion. AUT construction management professor John Tookey said at the time that households should “deal with small problems before they become big problems and have a regular budget for maintenance”, naming finances, skills shortages and an ageing population as the main barriers.

The underlying evidence goes back further. BRANZ’s 2018/19 pilot survey physically assessed 832 houses and found 90% of owned and 97% of rented dwellings needed maintenance on key exterior components. A 2024 BRANZ-led report with the Productivity Commission and Victoria University of Wellington put average required spend at $12,600 per dwelling, or $20.8 billion nationally at 2018/19 prices, with roofs, cladding and windows accounting for most of it.

Prices rose while the asset rotted

That 2024 report contained the most uncomfortable numbers for anyone lending against, insuring or trading houses. The share of households doing any maintenance at all had fallen from 45-50% in the late 2000s to just 35% by 2018/19, with the top income quartile carrying 42% of all maintenance spending. Adjusted to 2023 dollars, the mid-range underspend reached $27.5 billion, 4.5 times the cost of major natural disasters between 2018 and 2023.

The same report noted house prices rose 33% over that period while insurance premiums rose 22%. Read that plainly: the market priced the land and the location, not the timber and iron sitting on it. Valuers working off comparable sales and banks lending on loan-to-value ratios are treating a depreciating, under-maintained asset as if it were in sound condition.

The safeguard nobody regulates

The one checkpoint meant to catch this before settlement is the pre-purchase inspection. In New Zealand, anyone can offer one. Prendos New Zealand director Dr Dirk Stahlhut warns that no licence or formal qualification is required to call yourself a building surveyor, and the system’s wider failures are hard to miss, with 37% of residential final inspections failing in the past 12 months. MBIE has confirmed it has no plans to license pre-purchase inspectors.

The courts have already priced the gap. In 2025, judgments awarded damages of $500,000 and nearly $1 million against vendors who concealed rot and leaks, in one case through what the judge called “concealment works”. The buyer’s own inspection report missed weathertightness problems the vendor’s report had flagged. Justice Andrew noted that the NZ Standard for property inspections is voluntary and that “anyone who is so-minded can set themselves up as a pre-purchase inspector.” The building minister’s office responded by saying the issue sat outside the portfolio.

Why this is a market failure, not a nanny-state cause

This is not a case for more bureaucracy. It is a textbook information problem. Vendors know more than buyers, inspectors face no consequences for poor work, and lenders and insurers are left underwriting assets nobody has properly assessed. Making the existing inspection standard mandatory, or a light-touch licensing regime with professional indemnity requirements, would cut transaction risk rather than add red tape. Every other party in the deal, from agents to lawyers to mortgage advisers, is already regulated.

For business, the implications are immediate. Agents who reassure buyers about warranties or condition are carrying liability they may not have priced. Lenders and insurers should expect condition data to become a bigger part of underwriting. Builders and qualified surveyors face a deep, durable pipeline of remediation work if owners can find the cash.

The 2% buffer will not appear in any listing. Until someone with authority forces condition into the price, buyers like Alex Harman will keep discovering the real cost of their home after the keys change hands.

Sources

• Newsroom: Homebuyers face big bills for $27b-plus deferred maintenance on NZ housing stock (2026-11-04)
• RNZ: 90% of New Zealand homes in need of immediate maintenance (2026-03-11)
• NZ Herald: Why New Zealand’s shameful legacy of shoddy and leaky building is not over yet (2026-08-28)
• NZ Herald: Judge critical of pre-purchase property inspection sector and ‘poor quality’ reports after $500,000 leaky building case (2025-07-23)
• Homes for Generations: Undone Maintenance – What will it cost? (2024-05)
• Building Better: Undone Maintenance – What will it cost? (2024-05)
• BRANZ: SR456 Assessing the condition of New Zealand housing – Survey methods and findings (2019)