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On the cusp of a big downturn for residential builders

A major slowdown in the construction industry is fast approaching.

Thursday, March 30th 2023, 6:07PM

by Sally Lindsay

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.

Tags: building

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Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 6.39
ANZ 8.64 7.74 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.14 6.79 6.65
ASB Bank 8.64 7.14 6.75 6.39
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.14 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.74 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 6.79 - -
Co-operative Bank - Owner Occ 8.40 6.99 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.49 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.89 6.55 6.35
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.69 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.74 7.35 6.99
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 7.99 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 6.99 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.65 7.25 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank 8.74 7.74 7.09 6.95
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 7.14 6.49 6.35
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.14 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 7.79 7.55 7.45
TSB Special 8.64 6.99 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - 6.55 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Lender Flt 1yr 2yr 3yr
Westpac 8.64 ▼7.49 7.35 6.99
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - ▼6.89 6.75 6.39
Median 8.64 7.14 6.82 6.65

Last updated: 11 July 2024 1:26pm

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