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Relief as consents bounce back up

Housing supply pipeline gets a boost as new data reveals the highest level of new dwelling consents nationwide in over a decade.

Friday, July 29th 2016, 12:00PM

by Miriam Bell

Statistics New Zealand’s latest consents data shows that over 29,000 new residential dwelling consents were issued in the year to June 2016.

This was an increase of 16% from the previous June year and the highest annual total for a June year since 2004.

Statistics New Zealand business indicators manager Clara Eatherley said that Auckland and surrounding regions were the main contributors to this growth.

“There were 9,651 homes consented in Auckland in the latest June year, up 16% on the 2015 year.

“Canterbury’s total decreased over the year, but remains at a historically high level.”

In June 2016 itself, there was a total of 2,752 new dwellings consents issued nationwide, which was a 35% increase from June 2015.

Auckland saw 921 dwelling consents issued in June. This was up on May’s total of 732 and up 31% on June 2015.

The new data came after several months of stalling consent trends – and offers some hope that the supply pipeline, particularly in Auckland, is stepping up a gear.

Westpac industry economist David Norman said the rebound was a welcome change in direction after last month’s decline and a period of mixed month-on-month changes.

“Our concern was that developers in Auckland were in a holding pattern, pausing until the Unitary Plan is signed off.

“But consents in Auckland were up 17% in seasonally adjusted terms this month, while Tauranga and Hamilton saw further strength.”

The Unitary Plan recommendations suggest the potential for a further strong uptick in Auckland home-building is there, Norman said.

“But we must wait and see how many of these proposals are approved by Auckland Council before we can be confident that the shortfall of 30,000 dwellings (and growing) in Auckland can be addressed with even greater speed.”

ASB senior economist Jane Turner said the lift in consents was an encouraging sign that building demand is continuing to grow.

“Building consents bounced back with conviction in June, after relatively subdued growth over the first half of the year (particularly in Auckland. 

“The increase was broad based across the regions with the exception of Canterbury, which continues to gradually wind down from earthquake rebuild peaks.”

A marked increase in consent issuance for Auckland townhouses and apartments highlighted that the city’s housing shortage needs to be addressed with higher density solutions, she said.

“The proposed Unitary Plan could add further to building demand of this type, although any lift in activity will be gradual given capacity constraints already emerging in the building industry.”

Earlier this week, Building and Housing Minister Nick Smith released the latest National Construction Pipeline Report, which also showed record levels of building activity nationwide.

Smith said the report forecasts construction activity to remain stronger for longer as compared to last year’s report, with the boom continuing to 2021.

“The growth in residential activity in Auckland is particularly encouraging as it forecasts that next year more homes will be built in Auckland than ever before.

“Residential construction has been growing at more than 20% a year in Auckland for the past five years and is projected to reach an all-time high of 13,332 homes in 2017, and to stay at those record levels until 2022.”

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Lender Flt 1yr 2yr 3yr
AIA 5.35 4.49 5.25 5.55
ANZ 5.54 5.15 5.85 6.15
ANZ Blueprint to Build 2.78 - - -
ANZ Special - 4.55 5.25 5.55
ASB Bank 5.35 4.49 5.25 5.55
Avanti Finance 5.45 - - -
Basecorp Finance 6.45 - - -
Bluestone 5.29 7.49 7.59 -
BNZ - Classic - 4.55 5.25 5.45
BNZ - Mortgage One 5.55 - - -
BNZ - Rapid Repay 5.55 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Std, FlyBuys 5.55 5.35 5.94 5.99
BNZ - TotalMoney 5.55 - - -
CFML Loans ▲6.45 - - -
China Construction Bank 5.50 5.40 6.14 6.40
China Construction Bank Special - 4.45 5.19 5.45
Credit Union Auckland 5.95 - - -
First Credit Union Special 5.85 4.70 5.20 -
Heartland Bank - Online 4.00 3.85 4.70 4.84
Heretaunga Building Society 5.95 4.80 5.50 -
HSBC Premier 5.49 4.39 5.15 5.39
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.25 ▲4.29 ▲5.09 ▲5.35
Kainga Ora 5.43 4.57 5.58 5.85
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 5.00 5.55 6.19 6.39
Kiwibank - Offset 5.00 - - -
Kiwibank Special 5.00 4.55 5.19 5.39
Liberty 4.84 - - -
Nelson Building Society 5.95 4.95 5.85 -
Pepper Essential 3.44 - - -
Resimac 4.59 5.60 6.16 6.29
Lender Flt 1yr 2yr 3yr
SBS Bank 5.29 4.69 5.35 5.49
SBS Bank Special - 4.19 4.85 4.99
Select Home Loans 4.09 4.29 4.86 5.09
The Co-operative Bank - First Home Special - ▲4.19 - -
The Co-operative Bank - Owner Occ 5.45 ▲4.29 5.19 5.45
The Co-operative Bank - Standard 5.45 ▲4.79 5.69 5.95
TSB Bank 5.59 ▼5.14 ▼5.79 6.15
TSB Special 4.79 ▼4.34 ▼4.99 5.35
Unity 5.65 4.80 5.50 -
Wairarapa Building Society 5.24 4.55 5.20 -
Westpac 5.54 5.09 5.79 6.09
Lender Flt 1yr 2yr 3yr
Westpac - Offset 5.54 - - -
Westpac Special - 4.49 5.19 5.49
Median 5.45 4.55 5.25 5.52

Last updated: 19 May 2022 10:42am

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