Residential construction booming

Statistics New Zealand’s Value of Building work report for the September quarter shows the residential construction sector won’t be cooling down anytime soon

Total building activity grew 1.4% in the September quarter, following consecutive increases of more than 5% in the March and June quarters. The increase was driven by steady growth in the residential sector, as non-residential activity remained steady.

In current prices, the value of all building work was $5.5bn – up 22% on the same period last year and up 3.2% compared to the previous quarter. For the September quarter, the value of building consents fell 2.3% – comprised of a 1.8% increase in residential consents and a 12.5% fall in non-residential consents.

For residential only, activity rose 2.4% in the quarter – this is the fifth consecutive quarter that there has been an increase of 2% or greater. By value, residential building work rose a seasonally adjusted 4.3%, following a 7.4% increase in the previous quarter.

The actual value of residential building work was $3.3bn – a 25% increase on the 2015 September quarter.

Non-residential activity flat

Non-residential building activity was unchanged in the September quarter, following increases of 5.9% and 4.8% in the March and June quarters respectively. In current prices, the value of non-residential building work was up 1.2%.

In the regions

Auckland continued to dominate New Zealand’s construction market, accounting for more than a third of all building work by value.

There was $1.2bn of residential work in Auckland up (32% on the 2015 September quarter) with Canterbury ($646m; up 1%) the next largest contributor.

The value of non-residential work in Auckland was up 33% from the September 2015 quarter to $612m, Canterbury ($553m; up 8.4%) was again the next largest contributor.

Seasonally adjusted, the regions that recorded the biggest increases in the value of all building work in the September quarter were:

• Wellington – up 18%.
• Rest of South Island – up 13%.
• Rest of North Island – up 6.5%.
• Waikato – up 2.8%.
• Auckland – down 0.2%.
• Canterbury – down 1.5%.