Property

On the cusp of a big downturn for residential builders

A major slowdown in the construction industry is fast approaching.

Thursday, March 30th 2023

Building consents have plunged 29% in the year to February, Stats NZ figures show.

There were 2,972 new homes consented last month, the fifth month in a row the number of new homes consented has been below the same month of the previous year.

“The drop in the number of homes consented last month is big when compared with February last year which had the highest number of homes consented for any February month on record,” Michael Heslop, NZ Stats construction and property statistics manager says.

On a yearly basis the number of new consents reached 48,257, down 3.3% compared to the previous 12 months.

While the decline was small, it is the first time on an annual basis they have dropped since 2012. Over that time consents have spiralled up 342% creating a massive building boom. 

However, the number of consents for new homes issued last month is at a similar level to what it was in 2021, says Heslop.

“The number of new homes consented has been declining since the peak in early 2022,” Heslop says.

In seasonally adjusted terms, the number of new homes consented last month fell 9% compared with January. This follows a seasonally adjusted fall of 5.2% in January 2023.

Regions drop

All regions except Bay of Plenty and Marlborough consented fewer new homes when compared with February last year.

“Cyclone Gabrielle may have caused some disruption to consent issuance in affected regions in February,” Heslop says.

“However, the monthly fall in homes consented was seen across nearly all regions, including those not directly affected by the cyclone.”

The numbers of new homes consented in regions that contributed most to the overall monthly drop were:

  • 128 in Otago, down 47% compared with February 2022);
  • 517 in Canterbury, down 46%;
  • 202 in Wellington, down 35%; and
  • 1,289 in Auckland, down 21%.

The numbers of new homes consented in February in other regions affected by adverse weather events were:

  • 108 in Northland, down from 144 in February last year;
  • 297 in Waikato, down from 349;
  • 6 in Gisborne, down from 15; and
  • 46 in Hawke’s Bay, down from 53.

The adverse weather events earlier this year may impact home consenting numbers in affected regions in the coming months. Some emergency repairs do not require a building consent and will therefore not be included in future building consent issued data, says Heslop.

Types of consents

There were 27,872 multi-unit homes (townhouses, apartments, retirement village units, and flats) consented in the year ended last month, up 15% compared with the previous. year.

The number of stand-alone houses fell 20% to 20,385 over the same period.

Comments

No comments yet

Most Read

SBS FirstHome Combo 4.39
Unity First Home Buyer special 4.69
Co-operative Bank - First Home Special 4.89
TSB Special 4.99
ANZ Special 4.99
ASB Bank 4.99
Kiwibank Special 4.99
Westpac Special 4.99
AIA - Go Home Loans 4.99
ICBC 4.99
Co-operative Bank - Owner Occ 4.99
Nelson Building Society 4.97
Kainga Ora 4.99
ICBC 4.99
Co-operative Bank - Owner Occ 4.99
Wairarapa Building Society 4.99
Unity 4.99
TSB Special 4.99
ANZ Special 4.99
ASB Bank 4.99
Westpac Special 4.99
AIA - Go Home Loans 4.99
Westpac Special 5.39
ICBC 5.49
BNZ - Classic 5.59
Co-operative Bank - Owner Occ 5.69
ASB Bank 5.69
SBS Bank Special 5.69
AIA - Go Home Loans 5.69
BNZ - Std 5.79
Kainga Ora 5.79
TSB Special 5.89
Kiwibank Special 5.89
SBS FirstHome Combo 4.19
AIA - Back My Build 4.44
CFML 321 Loans 5.25
Co-operative Bank - Standard 6.20
Co-operative Bank - Owner Occ 6.20
Heartland Bank - Online 6.25
Kiwibank Special 6.50
Kiwibank - Offset 6.50
Kiwibank 6.50
Unity 6.64
TSB Special 6.64

More Stories

Four decades of 6-7% yearly house price growth ending

Friday, March 21st 2025

Four decades of 6-7% yearly house price growth ending

New Zealander’s reliance on property capital gains in the mid-single digits is at an end.

[TMM Podcast] Yelsa serves up “marine reserve” of property buyers

Friday, January 31st 2025

[TMM Podcast] Yelsa serves up “marine reserve” of property buyers

It’s been years in the making and former real estate agent Mike Harvey is now coming to market with his platform matching buyers and sellers, an offering he says will be a gamechanger for the industry.

Leaving last year's stumbling housing market behind

Friday, January 17th 2025

Leaving last year's stumbling housing market behind

As interest rates ease and job losses climb, New Zealand’s housing market faces a mixed year of modest growth, with conflicting forces shaping the outlook for homebuyers and investors.

Don’t bet on house prices rising faster than incomes

Wednesday, January 15th 2025

Don’t bet on house prices rising faster than incomes

Former Reserve Bank Governor and National Party leader Don Brash says there are grounds for believing that house prices may finally have ended the three-decade period when they rose significantly faster than incomes.