An Evidence-Based Framework for Whole-life Cost Analysis of Residential Buildings in New Zealand

Abstract

The construction industry plays a crucial role in the global economy, with residential building projects accounting for a significant share of activities, particularly in the Asia-Pacific region and New Zealand. Whole-life Costing (WLC) is increasingly recognised as a vital approach to fostering economic sustainability, facilitating informed decision-making, and enhancing resilience in construction projects. However, despite its acknowledged advantages, there is no tailored WLC framework available for residential buildings, particularly in New Zealand. This absence of a specific, context-aware framework has led to the underutilization of WLC principles and inadequate lifecycle cost management within the sector. This thesis fills the research gap by creating a WLC framework specifically designed for residential buildings in New Zealand, considering the unique environmental, social, regulatory, and seismic challenges the country faces. Thus, this research aims to develop a WLC framework that considers all elements to enhance the estimation accuracy of residential buildings for long-term economic sustainability, benefiting industry professionals, policymakers, homeowners, and researchers involved in New Zealand's residential.

This research adopts an interpretivist philosophy, applying an inductive approach and qualitative methodology. The study was structured in three stages: a systematic literature review and framework document analysis; 22 semi-structured interviews with industry stakeholders, including quantity surveyors, architects, engineers, project managers, facilities managers, homeowners, and government representatives; and a validation phase involving five expert participants. Initially, 80 factors influencing global Whole-life Cost (WLC) estimation were identified and refined to 37 key factors relevant to New Zealand’s residential construction context. System dynamics modelling, through causal loop diagrams, was then used to uncover complex feedback loops and interactions among these factors. The Analytic Hierarchy Process (AHP) subsequently prioritised them, ensuring accurate weighting and contextual relevance. In the validation stage, expert reviewers assessed the selected factors for clarity, relevance, and applicability to the New Zealand context. Their feedback was thematically coded to identify consensus and capture suggestions for refinement. This rigorous process enhanced the robustness of the framework, confirmed the prioritisation outcomes, and strengthened its practical applicability for industry stakeholders.

Significant obstacles to WLC implementation include methodological complexity, a lack of local whole-life cost data, fragmented industry practices, and insufficient integration with standard procurement and project delivery systems. The validated framework addresses these challenges by including components for acquisition, construction, operation, maintenance, end-of-life, and external social and environmental costs. Key validation insights highlighted the importance of seismic resilience, variations in regional climate, material evaluation, differences in labour productivity, supply chain resilience, and the need for integration of local climate data. Recommendations also emphasised usability improvements, such as pre-populated datasets, scenario modelling, example case studies, and dashboard interfaces with dropdown menus.

The development of the New Zealand-specific Whole-of-Life Cost (WLC) framework represents an innovative and dynamic approach that effectively bridges theoretical concepts with practical applications. It enables stakeholders to reconcile initial construction costs with long-term operational efficiencies, resilience to hazards, and commitments to environmental sustainability. This research contributes significantly to the literature and practice of lifecycle cost modelling, providing guidance for sustainable housing development that aligns with the nation's economic and sustainability objectives. The framework serves as a vital resource for policymakers, practitioners, and researchers dedicated to improving the accuracy of lifecycle cost assessments, advancing sustainability initiatives, and incorporating holistic, long-term perspectives into the residential construction sector in New Zealand.