Quarterly building boom evident in new stats

New figures show NZ building activity and prices for the March 2021 quarter have both risen compared to the previous quarter and to this time last year. The figures also show Covid-19 had a dampening effect on New Zealand building valued at nearly $7billion in last year’s March quarter

The figures, released by Stats NZ on June 4, indicate building activity rose a seasonally adjusted 3.7% in the March 2021 quarter, compared with the December 2020 quarter.

Estimated volumes of residential and non-residential work both grew in the March 2021 quarter, with residential growing 4.3% and non-residential work rising 2.6%.

This follows a volatile year for non-residential figures, with the volume of non-residential building work falling 27% in the June 2020 quarter, rising 33% in the September 2020 quarter and falling 4.9% in the December 2020 quarter.

Total building volume in the March 2021 quarter rose a seasonally adjusted 3.7% compared with the December 2020 quarter.

Significant building values in Auckland, Canterbury

Total building value hit $6.7bn for the March 2021 quarter. Compared to the March 2020 quarter, which had been strongly affected by Covid-19, this is a rise of 13%. The total value figure was made up of residential building work, which rose 21% to $4.6bn, and non-residential work, which fell 0.6% to $2.1bn.

Figures for the previous quarter were identical in terms of total value, with $6.7bn reported for the December 2020 quarter. In the December quarter however, residential building work rose 8.1% and non-residential work fell 6.8% from the quarter before.

Across the regions, the actual value of total building work in the March 2021 quarter was:

• Auckland – up 13% to $2.7bn.
• Waikato – up 18% to $673m.
• Wellington – up 29% to $621m.
• Rest of North Island – up 16% to $1.1bn.
• Canterbury – up 8.2% to $918m.
• Rest of South Island – up 1.0% to $668m.

The non-residential building types with the most work put in place (by value) in the March 2021 quarter were:

• Education buildings – $320m (up 16% on March 2020; similar to $318m in December 2020 quarter).
• Hotels, motels, boarding houses, and prisons – $282m (down 4% on March 2020; down from $378m in December 2020 quarter).
• Factories and industrial buildings – $265m (up 19%; up from $215m in December 2020 quarter).
• Storage buildings – $252m (unchanged from March 2020; down from $305m in December 2020 quarter).

Survey feedback reveals Covid impact on new home building

Stats NZ asked more than 4,500 builders, developers and owners to provide their perceptions of Covid-19’s impact on building projects. Possible impacted areas included cashflow, cost, labour, materials and productivity.

Over two-thirds of respondents from new-home projects reported a Covid-19-related impact on the availability of materials and equipment.

Stats NZ construction statistics manager Michael Heslop said respondents of building projects for new homes in Auckland reported greater impacts than those in the rest of the country, but noted that this may also be influenced by Auckland’s high volume of building consents for new homes.

Auckland has been making up a larger proportion of all new homes consented since the late 2000s. In the year ended April 2021, the number of new homes consented in Auckland was 18,224 and accounted for nearly 43% of all homes consented nationally.

Auckland also saw an increase of around 23% in the number of new homes consented between the year ended April 2020 and April 2021.