SCORCHING SUMMER FOR BUILDING SECTOR

The March 2019 quarter set a strong tone for building activity, recording the strongest growth in three years

Building activity increased a seasonally adjusted 6.2% in the March 2019 quarter when compared to the December 2018 quarter, driven by non-residential construction that included work on social and cultural buildings, offices, and universities.

Non-residential building activity increased 9% in the March quarter, while residential construction went up 4.3%.

Recent growth was also reflected in an increase in paid hours for the construction industry, as shown in the latest quarterly employment survey data.

Auckland and Waikato driving value

The actual value of total building work was $6.1bn for the March 2019 quarter — up 16% from the March 2018 quarter.

By region, the actual value of total building work in the March 2019 quarter (compared with the March 2018 quarter) was:

• $2.5bn in Auckland – up 26%
• $595m in Waikato – up 30%
• $474m in Wellington – up 1.5%
• $950m in rest of North Island – up 13%
• $931m in Canterbury – down 1.0%
• $618m in rest of South Island – up 12%

Residential increases

In the year ended March 2019, the national value of residential building work increased $1.1bn (7.9%) compared to March the previous year, while the national value of non-residential building work increased $923m (12%). Both were driven by strong performances in Auckland during the period.

Non-residential boosts

The non-residential building types that recorded the most growth in the year ended March 2019, compared with the March 2018 year, were:

• Shops, restaurants, and bars — up $337m (up 41%)
• Hotels, motels, boarding houses, and prisons — up $248m (up 40%)
• Storage buildings — up $199m (up 26%)