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Shearer's building project calculations questioned

Published: 9:19AM Monday November 26, 2012 Source: ONE News

The Labour Party has been told it will need to improve its maths skills if it is to pull off an ambitious new home building scheme.

It came as party leader David Shearer took to the streets of Auckland today in a bid to promote the 'Kiwibuild' policy, and get an idea of the state of the housing market.

Kiwibuild would see the construction of a range of houses from one to five bedroom homes, at a range of prices, with $300,000 as the median house price.

To meet Shearer's objective 27 new houses would need to be built every day.

"If we're able to build on a larger scale the savings in terms of bulk buying are considerable. We can drive the prices down by 25% to 30% in terms of the price of materials alone," said Shearer.

However, his calculations have been questioned by the construction industry.

"That'll be quite difficult I think, given the volumes," said Registered Master Builders chief executive, Warwick Quinn.

"If they're talking 10,000 houses a year and purchased through government, it'll depend a lot on how they procure those services.

"I think the jury's still out on whether you can make those sorts of savings."

But with house prices soaring, particularly in Auckland, Labour has caught the attention of many of those hopeful of getting a foot on the property ladder.

"We're realising, many of us, that the market isn't going to help us on its own," said Mangere home-owner, Richard Drake.

"The market may help you one day, stab you in the back in the next, and so we need someone to do something."

It's a sentiment echoed by Shearer, who said: "Clearly the market is not doing it and so this is a way to get in there and give people a real shot."

He also claimed the housing foundation is already building houses for the price he states in his plan.

"They are doing it without the advantages of economies of scale so if you are looking at 10,000 houses obviously you are able to get materials and all the other parts that go to make up a house cheaper than you do if you are doing 50 to 60 houses like the Housing Corporation is doing."

Shearer said he hopes the long-term building project will encourage New Zealanders living in Australia back to the country.

Prime Minister John Key has slammed the proposal as unrealistic.