It's time for a change!

Modernising How Building Research Is Funded in New Zealand

Behind the scenes of every well-built home is a lot of research — from materials and construction methods to durability, safety, and sustainability. Now, the way that research is funded in New Zealand is getting a long-overdue update.

The Government has announced changes to modernise building research funding, with the goal of making the system more transparent, efficient, and better aligned with the needs of today’s building industry and homeowners.

Why Change Was Needed

The current building research levy system is based on legislation introduced back in 1969, and it hasn’t been properly reviewed in more than 50 years. Even the levy rate itself hasn’t changed since 1977.

Over time, this has created a system that no longer reflects how the modern building sector works — or what people expect from public funding.

A recent review found that the existing setup:

• Lacks transparency

• Limits competition for research funding

• Creates unnecessary duplication and costs

How Building Research Is Funded Today

At present, most construction projects valued over $20,000 pay a Building Research Levy of $1 for every $1,000 of contract value. This funding goes to the Building Research Association of New Zealand (BRANZ), which invests it in research aimed at improving building materials, practices, and performance.

At the same time, homeowners and developers also pay a separate building levy when applying for a building consent on projects over $65,000. That levy supports work led by the Ministry of Business, Innovation and Employment (MBIE), including policy development, education, compliance, and monitoring.

In effect, many consent applicants have been paying two separate levies to support Government-funded improvements to the building sector.

What’s Changing

To simplify things, the Government will repeal the Building Research Levy Act 1969 and replace it with a new approach.

Going forward:

• Building research will be funded through the existing building levy under the Building Act 2024

• Research funding will be managed centrally, with input from the building sector

• A portion of the levy will be ring-fenced specifically for research, ensuring consistent, long-term support

This creates a clearer, more streamlined funding system that’s easier to manage and understand.

More Choice and Competition in Research

One of the biggest changes is that research funding will become contestable.

This means organisations such as:

• Universities

• Industry groups

• Research agencies

will be able to apply for funding, creating more opportunities for innovation and ensuring research money is spent where it delivers the most value.

This competitive approach is designed to encourage fresh thinking, practical solutions, and research that responds directly to real-world building challenges.

What This Means for Homeowners and Builders

For homeowners and consent applicants, these changes should result in:

• Lower administrative costs, with only one levy to manage

• Savings of around $65 per building consent

• A more efficient consent process for councils

• Better-targeted research that improves building quality and resilience

Over time, better research helps lead to safer, more durable, and more sustainable homes.

The Role of BRANZ Going Forward

BRANZ has played a key role in improving New Zealand’s building standards for decades — particularly in sustainability, quality, and resilience.

Under the new system:

• BRANZ will continue to play an important role in building research

• Transitional arrangements will be put in place to maintain current funding levels

• Future funding will be allocated under the new, more transparent model

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Looking Ahead

By modernising how building research is funded, the aim is to create a system that is:

• More transparent

• More accountable

• Better aligned with industry and homeowner needs

At Wellington Building Company, we welcome changes that support innovation and improve building outcomes. Strong research underpins better design, smarter construction, and homes that perform well for years to come.

If you’d like to talk about how ongoing improvements in building standards and research affect your project, we’re always happy to help.