Report forecasts $32bn building boom by 2016

The New Zealand Building and Construction Productivity Partnership is predicting a record construction peak in 2016 

Citing unprecedented levels of demand in Auckland’s housing market and the ongoing Canterbury rebuild, the report forecasts the value of building and construction work will reach $32bn – 23% higher than the previous 2007 record.

The high growth rates are forecast to last four years or more, 10% longer than previous booms. Over the forecast period, the value of residential work is expected to increase by 48%.

The report also predicts higher density housing will become more common, almost doubling from current construction rates by 2019.

Auckland set to soar

Auckland accounts for a third of New Zealand’s building and construction work and is expected to increase 68% over the forecast period. Residential building work is expected to more than double from current levels, increasing 150% by 2017.

It is predicted by 2018 that the number of multi-unit dwellings being built in Auckland will exceed the number of detached dwellings.

The Canterbury rebuild is forecast to peak in 2015, to $8.2 billion of work, before falling to 5% below current levels in 2019. Non-residential building and construction work is predicted to increase from $2.1 billion in 2012 to $4.7 billion per annum from 2015-2017.

Steady growth is predicted in the Waikato/Bay of Plenty region, with both residential and non-residential work increasing by 28% over the forecast period. Residential work is expected to peak at $2.3 billion in 2016.

Wellington is also expected to experience consistent growth, increasing 31% to $2.3 billion in 2017. Much of the growth – 72% – is expected in the residential sector, while non-residential work will increase by 3%.

Across the rest of the country, building and construction activity is expected to increase by 12%. This increase is driven by a 31% increase in non-residential work, while residential work is expected to decline by 11% over the forecast period.

BRANZ and Pacifecon – a construction industry data analyst – produced the report based on current and forecast data, on behalf of the Building and Construction Productivity Partnership.