Matrix Homes managing director Sean Murrie outside of one of their new homes built in a factory as a way to cut costs.

Houses built on a factory floor in only 12 days could save the country millions of dollars, a Wellington company says.

Matrix Homes officially opened its factory at the old GM manufacturing site in Trentham yesterday.

The company, established last year, has designed and is building modular housing at two-thirds the cost of traditional building methods.

Managing director Sean Murrie said the company was founded on a belief that New Zealanders paid millions more than they should for housing.

"We set out to drastically reduce the cost of a new home without sacrificing the quality you expect in what is most people's largest investment," Murrie said.

"It's actually quite appropriate that it's the GM factory because our way of building is as an assembly line, pretty much, we just happen to be building houses rather than cars."

Matrix Homes builds two modules which can be joined up in more than 100 ways, as well as being added on to and removed at any stage.

The first showhome was officially opened yesterday - a three-bedroom home costing $185,000, Murrie said, compared to a New Zealand-average $300,000 cost without land.

The company had sold two houses, with a further 50 being worked through. Prices range from $89,000 for a one-bedroom home to $195,000 for a four-bedroom, two-bathroom house.

The pricing includes all internal fittings, but excludes delivery costs, with modules able to fit on the back of a truck and on the Cook Strait ferries.

"Most people don't want to have a half million dollar-plus mortgage, even if they could get the funding for it," Murrie said. "We can do a lot about that."

Matrix Homes' factory was set up to produce 300 houses a year, but its target was 2000.

"Overall, we build using jigs, which means you don't have builders on site trying to cut and fit it all properly," Murrie said.

"It all goes together in 12 days; that might sound fast, but in America, using a factory system like ours, they can do a whole house in two days."

Company architect Graeme Farr said the idea was inspired by manufactured homes in the US, where one company had built 1.6 million comparative houses.

Deputy Prime Minister Bill English, who officially opened the first showhome yesterday, said in the developed world only Norway currently had more expensive housing than New Zealand.

Most of the new housing being built here was in the $500,000-plus bracket, he said.