Statistics New Zealand figures show 4,490 new dwellings were consented in August. This is an all-time high for any month – up 42% on the same month last year.
The number of new dwellings consented in the year to August was at a record 46,453, up 24% in the 12 months to August last year.
The strong growth in new consents was led by Auckland and Canterbury.
Westpac senior economist Satish Ranchhod says while the number of new dwellings consented rose by 3.8% in August, the bank had expected a sharp fall due to the lockdown in the middle of the month.
However, consent processing appears to have been unaffected by the dialling up of the alert level.
Ranchhod says while there is a large pipeline of work planned, there are questions around how quickly this work will be completed.
“Building firms across the country have been running at pace and are already struggling with difficulties sourcing both materials and staff.
“Those shortages are constraining the amount of work that can be completed and may mean that some projects get delayed.”
He says the associated cost pressures are also squeezing some firms’ margins and pushing the price of new projects upwards.
“This still leaves the country with a very strong outlook for building activity over the coming year, but it’s clear that capacity constraints will be a major hurdle for many projects.”
Looking across regions, Auckland continues to account for the bulk of new consents, with nearly 20,000 new dwellings consented over the past year.
“For much of the past decade, home building in the country’s most populous region failed to keep up with population growth,” says Ranchhod.
However, that picture now looks radically different. Population growth has plummeted due to the border closure. At the same time, home building is surging.
With a significant number of projects already in train, and more to come, much of the shortages that developed over the past decade will be eroded over the next few years.
The current building boom isn’t just limited to Auckland. Consent levels are running hot in many regions including Northland, Waikato, Hawke’s Bay, Manawatū-Whanganui and Canterbury.