Archive | Building consents

Auckland above 10,000 home consents/year again

Auckland’s consent level for new homes got back above an annual rate of 10,000 in January after dipping in December. The 512 consents in January were 6 above the number a year earlier.

For the year, Auckland had 10,032 consents for new homes, compared to 9930 in the 12 months to December and 9275 in the 12 months to January 2016.

Nationally, consents for the month were up 3.4%, from 1695 to 1752, and for 12 months they were up 11.1%, from 27,124 to 30,123.

January is the traditional quiet month everywhere, but not usually as quiet as it got in Auckland’s central Waitemata & Gulf ward, where consents numbered only 9 in December and fell to 4 in January.

The Waitemata part of that ward covers the cbd & its western fringe, very much apartment & townhouse territory, so consent applications tend to be lumpy. In 8 of the last 12 months the ward had fewer than 50 consents, 3 months of 114, 155 & 179, and one outstanding month when 353 consents were issued.

In the previous 12 months, the ward’s consents exceeded 100 only twice, but they were months of 405 & 278, contributing to a total for 12 months that was 20% higher.

Looking forward into the new era of Auckland’s mostly approved unitary plan, when more intensification will be possible across 90% of suburbia, developers may disperse their search for cheaper land, resulting in more intensification in smaller centres.

Consents nationally for standalone houses fell slightly for the month but were up nearly 11% over 12 months, while consents for apartments have dipped slightly over 12 months and those for suburban townhouses & units are up nearly 28%.

Around Auckland by ward, this January & last, and the January 2017 year & previous 12 months:

Region: 512 (506), 10,032 (9275)
Rodney: 55 (60), 861 (865)
Albany: 194 (123), 2455 (2304)
North Shore: 17 (13), 455 (473)
Waitakere: 18 (46), 648 (465)
Waitemata & Gulf: 4 (80), 965 (1160)
Whau: 7 (11), 293 (189)
Albert-Eden-Roskill: 22 (29), 660 (449)
Orakei: 8 (10), 240 (490)
Maungakiekie-Tamaki: 25 (18), 423 (460)
Howick: 15 (17), 520 (572)
Manukau: 17 (36), 441 (419)
Manurewa-Papakura: 50 (37), 1079 (848)
Franklin: 80 (26), 992 (581)

Consents for the 4 residential market segments in January & the 12 months to January 2017 compared to the previous January & previous 12 months:

Houses: 1253 (1286), -2.6%; 21,277 (19,183), 10.9%
Apartments: 116 (89), 30.3%; 2430 (2511), -3.2%
Retirement village units: 98 (135), -27.4%; 1915 (1908), 0.4%
Townhouses etc: 285 (185), 54.1%; 4501 (3522), 27.8%.

Sector & total values against January 2016 or the previous 12 months:

New homes: $619 million/month ($641 million), -3.5%; $10.625 billion/year ($8.906 billion), up 19.3%
Alterations & additions: $129 million/month ($115 million), 12.4%; $1.899 billion/year ($1.728 billion), up 9.9%
Total residential: $748 million/month ($756 million), -1.1%; $12.524 billion/year ($10.635 billion), up 17.8%
Non-residential: $338 million/month ($310 million), 9.2%; $6.048 billion/year ($5.876 billion), up 2.9%
Total, including non-building: $1.108 billion/month ($1.083 billion), 2.3%; $19.055 billion/year ($16.922 billion), up 12.6%.

Earlier stories:
6 March 2017: Third quarter of plus-32% rises in Auckland construction input
10 February 2017: Townhouses & flats dominate shift in home styles

Attribution: Statistics NZ tables.

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Third quarter of plus-32% rises in Auckland construction input

The value of building work put in place in Auckland in the December quarter fell just short of $2 billion, and was up $500 million on the input a year earlier.

Image above: Residential work has soared well above the static input to commercial construction in Auckland.

Figures out from Statistics NZ on Friday show for the whole of 2016, $2 billion more was spent nationally on new homes than in 2015 – up from $8.4 billion to $10.5 billion – and across all construction sectors there was a $3.3 billion rise nationally to $19.87 billion spent for the year, all ex-gst.

Statistics NZ said residential work in Auckland rose 4.5% in the December quarter, and non-residential 17%.

Nationally, the 1.1% rise in residential work in the December quarter was the smallest increase in 6 quarters.

Combining the input in all sectors, the growth in construction input in Auckland hasn’t risen steadily since the market bottomed in 2011.

There was a spurt of 9-13% quarterly growth in 2012, and that was followed by quarterly growth of around 30% for the last 3 quarters of 2013, tapering off to a 20.5% increase in the March 2014 quarter and actually declining in the September quarter that year.

Since that dip, Auckland growth has been strong: 13.6% in the December 2015 quarter (compared to the same quarter a year earlier), then rises of 25.6% in the March 2016 quarter, 39% in June, 32.3% in September & 34.2% in December.

Attribution: Statistics NZ tables & release.

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Townhouses & flats dominate shift in home styles

Suburban townhouses & flats dominated the shift in building consent figures away from standalone houses last year.

The townhouse & flats segment of the market – essentially lowrise intensification outside the central urban areas – has grown by 330% since 2011, while the standalones have steadily lost market share, falling from 81% in 2011 to 71%.

Consents for all new homes last year totalled 29,970, up 10.5% on the 27,132 in 2015, according to Statistics NZ’s figures out yesterday.

Houses made up 21,310 of the 2016 total, 19,038 the previous year, so a rise of 11.9% for the year. For the month of December, however, the 1580 consents were down 4.9% for that month a year earlier.

Consents for the 4 market segments in December & the whole of 2016 compared to the previous December & the whole of 2015 were:

Houses: 1580 (1661), -4.9%; 21,310 (19,038), 11.9%
Apartments: 138 (427), -67.7%; 2307 (2539), -9.1%
Retirement village units: 193 (159), 21.4%; 1952 (1899), 2.8%
Townhouses etc: 294 (291), 1%; 4401 (3656), 20.4%.

Sector & total values against December 2015 or the previous 12 months:

New homes: $833 million/month ($868 million), -4%; $10.648 billion/year ($8.796 billion), up 21%
Alterations & additions: $156 million/month ($149 million), 4.3%; $1.885 billion/year ($1.727 billion), up 9.2%
Total residential: $989 million/month ($1.017 billion), -2.8%; $12.532 billion/year ($10.523 billion), up 19.1%
Non-residential: $595 million/month ($555 million), 7.2%; $6.019 billion/year ($5.919 billion), up 1.7%
Total, including non-building: $1.612 billion/month ($1.611 billion), 0.1%; $19.03 billion/year ($16.859 billion), up 12.9%.

Housing consents around the country:

Auckland: 740 (947), 9930 (9251)
Whangarei: 45 (41), 662 (447)
Kaipara: 20 (19), 267 (182)
Hamilton: 76 (142), 1179 (1205)
Bay of Plenty: 177 (176), 2520 (809)
Wellington region: 115 (106), 1992 (1721)
Christchurch & districts: 344 (510), 5202 (5830)
Queenstown-Lakes: 79 (62), 945 (816)

Around Auckland by ward:

Rodney: 60 (103), 866 (844)
Albany: 170 (156), 2288 (2274)
North Shore: 28 (143), 451 (480)
Waitakere: 43 (31), 676 (454)
Waitemata & Gulf: 9 (93), 1041 (1157)
Whau: 14 (24), 297 (201)
Albert-Eden-Roskill: 112 (144), 667 (445)
Orakei: 15 (70), 242 (506)
Maungakiekie-Tamaki: 129 (19), 416 (467)
Howick: 22 (46), 522 (585)
Manukau: 21 (26), 460 (406)
Manurewa-Papakura: 59 (55), 1066 (855)
Franklin: 58 (37), 938 (577).

Attribution: Statistics NZ tables.

Related story today: Smith exultant about figures that are plainly inflated

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Smith exultant about figures that are plainly inflated

Former housing minister Nick Smith, now building & construction minister, heaps praise on himself for a job extremely well done: “Building activity is at a record high, topping $19 billion for 2016 after 5 straight years of strong growth”.

But we all know it’s not true. Although Dr Smith said of yesterday’s building consent report that the figures he was quoting were “in inflation-adjusted terms”, both he & the rest of New Zealand know construction costs, land prices & house prices have been distorted way beyond the realm of the Reserve Bank’s narrow inflation focus.

It’s a sector which can be measured very accurately, but the figures Statistics NZ releases monthly on building consents for new homes carry distortions because of how applications are made. In some cases such as staged developments, consent applications & costs may be reported in different time periods. However, over a year, I suspect it’s reasonable to use these figures to carry out the calculations I’ve done here on changes in floor areas, values and values/m² of construction. The value of land is excluded from building consent figures.

Going back to the bottom of the market following the global financial crisis, 2011, the statistics show an average floor area of 191.6m². It rose the next year, declined for 3 years and recovered slightly in 2016. The percentage changes were rises of 2.9% in the first year and 1.8% in the last year, but falls of 2.7%, 2.6% & 4.3% in the intervening years.

The average value/dwelling was just under $280,000 in 2011, and rose in steps of $6600-16,000 during the next 4 years, equating to gains of 5.75%, 3.3%, 4% & 2%. Then, in 2016, the average jumped $31,000 to $355,300, a leap of 9.6%.

Putting those figures together to see what the consent value/m² has been, the starting point in 2011 was $1459/m². The end point, the average for 2016, was $1951/m² – a rise of $492/m² over 5 years, or 34%. In the first year off the market bottom the rise was 2.75%, but it’s since been consistently above 6% – 6.15% in 2013, then 6.75%, 6.71% and, last year, 7.67%.

An important factor in the equation is the falling proportion of total housing categorised as houses, distinct from 3 intensive categories – apartments, retirement village units and suburban townhouses & units – all of which generally have smaller floorplates than the average house but will generally be priced more highly per m² of building. The houses category fell from 81% of all housing consents in 2011 (when the apartment sector almost disappeared) to 71% in 2016.

Dr Smith habitually talks about consent figures as if they were actual construction. Statistics NZ doesn’t supply regular figures which would show the percentage of consents that turn into actual construction. Those percentages vary cyclically, according to figures I’ve seen long ago – heading into the peak of a boom the consent figures will have risen steeply, but once the boom ends actual construction can plummet.

In his release on the consent figures yesterday, Dr Smith said: “This is the longest & strongest growth phase in building activity in New Zealand history. It involves record levels of investment in homes, commercial buildings & infrastructure. The total value of consents in 2016, at $19 billion [for all consents, not just residential], is the highest ever and 30% more than the previous peak last decade, in inflation-adjusted terms.

“I am particularly encouraged by the ongoing strong growth in residential building activity, that has increased 19% nationally & 27% in Auckland over the past year. This is the fifth straight year of strong growth. You cannot grow a sector as large or as complex as building at more than about 20% compound/year without incurring problems with quality.

“The number of homes being built in 2016 – 29,970 nationally & 9930 in Auckland – is more than double that of 5 years ago and is the highest since 2004. This growth gives me confidence we will have the number of homes increasing in line with population growth by the end of the year.

“This ongoing strong growth shows the Government’s programme to increase housing supply is working. We have aggressively increased land supply with special housing areas in the short term, changes to Auckland’s planning in the medium term, and the national policy statement on urban development capacity & Resource Management Act reforms in the long term.

“We have complemented this with the Crown land programme and a record level of direct Government projects to build homes, such as Hobsonville. We’ve also provided record levels of assistance for first-homebuyers with the KiwiSaver HomeStart scheme, which has helped more than 20,000 people into their first home with about $500 million in KiwiSaver withdrawals for a deposit.

“This Government is, step by step, development by development, getting on and addressing New Zealand’s housing challenges.”

The figure of $19 billion includes $12.5 billion for new homes and alterations & additions to homes, $6 billion for non-residential buildings and just under half a billion dollars for non-building construction. The housing component has been rising rapidly – by 25.4% in 2012, 28% in 2013, then 20.5%, 10.5% and, last year, 19.1%.

The non-residential sector had 2 strong years – rises of 21.5% in 2014 & 15.9% in 2015, but was down to a 1.7% rise last year.

Related story today: Townhouses & flats dominate shift in home styles

Attribution: Statistics NZ tables & release, ministerial release.

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Building consent highs still don’t match migrant demand

Statistics NZ said today consents for new homes nationally hit an 11-year high in November, Auckland hit a 12-year high for a month and for a year, and Auckland consents represented “almost 40%” of the month’s total.

Against those impressive statistics, the figures show:

  • Auckland is not meeting demand for housing arising from net immigration, let alone natural population increase
  • Christchurch consents continued to tail off as the post-earthquake rebuild has wound down
  • Despite that, Auckland’s share of total consents nationally was 5 percentage points below its national market share at the 2004 high, and
  • Non-residential consent growth has been lacklustre over the last 5 years.

Below, first the figures followed by considerable detail, including some international aspects.

The bald figures against November 2015 or the previous 12 months:
2973 (2831) November consents for new homes, up 5%
30,303 (30,161) new home consents in November year, up 13.1%
$1.001 billion ($911 million) value for month, up 9.9%
$167 million ($153 million) additions & alterations for month, up 9.4%
$1.88 billion ($1.72 billion) additions & alterations for year, up 9%
$1.168 billion ($1.064 billion) total residential consents for month, up 9.8%
$12.56 billion ($10.34 billion) total residential consents for year, up 21.5%

Auckland:
1156 (966) Auckland consents for the month, up 19.7%
10,137 (8934) Auckland consents for year, up 13.5%

Residential sectors:
1886 (1864) new house consents for month, up 1.2%
375 (270) apartment consents for month, up 38.9%
205 (321) retirement village units for month, down 36.1%
507 (376) townhouses & suburban units for month, up 34.8%
21,391 (18,823) new house consents for year, up 13.6%
2596 (2263) apartment consents for year, up 14.7%
1918 (2086) retirement village units for year, down 8.1%
4398 (3621) townhouses & suburban units for year, up 21.5%

Non-residential:
$411 million ($531 million) total for month, down 22.6%
$5.98 billion ($5.8 billion) total for year, up 3.2%
Offices, administration & public transport, $102 million ($114 million) for month, down 10.5%
Offices etc, $1.15 billion ($1.16 billion) for year, down 0.9%
Education buildings, $58 million ($99 million) for month, down 41%
Education buildings, $1.17 billion ($1.08 billion) for year, up 8.4%

Totals (residential, non-residential & non-building construction):
$1.61 billion ($1.62 billion) for month, down 1%
$19.03 billion ($16.55 billion) for year, up 15%

Auckland & its wards, residential month & year:
Auckland: 1156 (966), 10,137 (8934)
Rodney: 55 (75), 909 (787)
Albany: 254 (196), 2274 (2341)
North Shore: 26 (81), 566 (357)
Waitakere: 84 (44), 664 (466)
Waitemata & Gulf: 155 (68), 1125 (1071)
Whau: 19 (23), 307 (185)
Albert-Eden-Roskill: 104 (40), 699 (377)
Orakei: 42 (104), 297 (457)
Maungakiekie-Tamaki: 21 (34), 306 (481)
Howick: 25 (52), 546 (559)
Manukau: 129 (65), 465 (393)
Manurewa-Papakura: 116 (112), 1062 (852)
Franklin: 126 (72), 917 (608)

Outside Auckland:
Whangarei: 70 (51), 658 (444)
Kaipara: 27 (14), 266 (171)
Hamilton: 107 (100), 1245 (1131)
Tauranga: 168 (176), 1704 (1337)
Wellington region: 81 (291), 1536 (1449)
Christchurch & districts: 390 (525), 5368 (6008)
Queenstown-Lakes: 71 (88), 928 (793)

The monthly high

2973 consents for new homes were issued nationally in November, up from 2575 in October, 2831 in November 2015, and the 7th successive month of consents exceeding 2500. January was the only month of the year when consents fell below 2300 (to 1695, a normal summer fall; consent figures for December will be released on 29 January).

Statistics NZ attributed the 11-year high for a month to “increased consents in Auckland & the usual pre-Christmas rush”. The previous high for a month was in March 2005, when 3027 new homes were consented. As I wrote in 2005, the numbers that March were skewed for the second time in 9 months: “This time it was for a combination of 2 increases, both effective from 31 March. One was an increase in the Department of Building & Housing levy, the other new building requirements under the new Building Act – not a levy, but extra requirements.”

The annual figures, their trajectory and foreign influences

30,303 consents were issued nationally for the November year, 13.1% up on the 26,793 in the previous 12 months. The annual rise has been steady since 13,529 consents were issued in the November 2011 year, which was the downpoint of the global financial crisis. On a rolling annual basis, consents fell just short of 30,000 in September and got just over that mark, to 30,161, in October.

Consents averaged just 2200/month over the first 4 months of 2016 and 2700/month through to November. Increasing to 31,000 consents/year will be hard to achieve over the next 6 months unless constraints are reduced on loans to investors and on the ability of first-homebuyers to borrow, and construction costs are constrained. The main cause for those constraints to change is that it’s election year.

Winding back immigration would also affect the election, which means the housing pressure in Auckland should continue unless the other big factor, Chinese investor interest, wanes. The Chinese government signalled tightening on the export of funds over the last few weeks but, as a report from the Asian Financial Forum in Hong Kong on Monday indicated, China’s largest sovereign wealth fund, CIC (China Investment Corp), expects to invest more in the US this year than it did in 2016. It spent $US1.7 billion on 2 Manhattan properties in 2016, the second of those a $US1 billion investment for a 45% stake in a building in the Rockefeller Centre in December.

China’s foreign exchange reserves have slid from a peak of $US4 trillion in June 2014 to $US3 trillion last month – incredibly, a dangerously low level. Trading Economics said the yuan depreciated 6.6% against the $US in 2016, the biggest one-year loss since 1994.

As analyst Jim Rickards has posted in various Daily Reckoning financial newsletters over the last few weeks, China runs into a fight with new US president Donald Trump if it devalues (more), but it doesn’t have the leeway to support its currency’s rise. Further devaluation or the threat of it, official or in effect, would encourage Chinese citizens to keep finding ways of getting money out of the country and, in the blink of an eye, into assets – such as New Zealand property.

Minister says it’s as fast as you can go

Nick Smith, who was housing minister (a title Bill English abolished after taking over as prime minister in December) and remains building & construction minister, said it was the first time in 12 years that consents for new homes in Auckland had topped 10,000.

“The 1156 consents issued in Auckland during November makes it the strongest month in more than 10 years. It is more than treble the 325 consents issued in Auckland in November 2008, when National became government. We need to consistently achieve more than 1000 consents/month in Auckland to match population growth….

“This is the 5th straight year of strong growth in construction, with growth averaging more than 20%/year. This is as fast as you can practically grow a sector as large & as complex as construction without compromising quality.

“This ongoing strong growth shows the Government’s programme to increase housing supply is working. We have aggressively increased land supply with special housing areas in the short term, changes to Auckland’s planning in the medium term and the national policy statement on urban development capacity & Resource Management Act reforms in the long term.

“We have complemented this with the Crown land programme and a record level of direct Government projects to build homes, such as Hobsonville. We’ve also provided record levels of assistance for first-homebuyers with the KiwiSaver HomeStart scheme, which has helped more than 20,000 people into their first home with about $500 million in KiwiSaver withdrawals for a deposit.

“This Government is step by step, development by development, getting on and addressing New Zealand’s housing challenges.”

Consent figures fall short of migrant need

The statistics show 38.9% of new home consents in November were in Auckland, up from 34.1% in November 2015. For the November year, Auckland’s market share was 33.5% (29.6%). Back in November 2004, the previous high for Auckland, the 1181 consents represented 44% of the market.

At a ratio of 2.7 residents:household, Auckland would have needed 12,421 new homes for its net intake of migrants for the latest year. The 10,137 consents for the November year (homes to be built) represent 81.6% of homes required in the last year. But for homes to be built in time to receive those immigrants in the last year, consents would have been needed beforehand. In the previous 12 months to November 2015, the 8934 consents issued for new homes in Auckland would have met 71.9% of the requirement for the next 12 months’ immigrants, ignoring natural increase.

Under the government-council special housing accord that ran from October 2013-September 2016 (with an extension for approved areas not fully processed), the target was 39,000 consents over 3 years (initially emphasised as houses, later emphasised as houses & sections consents, though the Ministry of Business, Innovation & Employment thinks it’s just houses) – 9000 the first year, 13,000 the second, 17,000 the third.

Dr Smith and Auckland’s mayor until last October, Len Brown, maintained they achieved 123% of the target in year 1 and 98% of the target in year 2 – 23,806 dwellings consented & new sections created.

The final government-council report on the accord said 37,538 net sections had been created & dwellings consented – 96% of target. It added: “Over the next 14 years, over 98,000 new greenfield & brownfield dwellings & sections are known to be in the development pipeline delivering an average of just over 7000 dwellings/year.”

Non-residential still in doldrums

Non-residential consents almost matched those for new homes in the November 2011 year – $3.64 billion against the residential $3.756 billion. But in the next 5 years, consents for commercial & public sector buildings have been left well behind.

Over those 5 years consents for new homes rose steadily – to almost $5 billion, then $6.3 billion, $7.7 billion, $8.6 billion and, for the last 12 months, $10.7 billion. That’s a total $38.3 billion for new homes since 2011.

In contrast, the non-residential sector’s consents almost made it to $4 billion in 2012, got to $4.15 billion the next year, then to $5 billion, $5.8 billion & just under $6 billion for the latest 12 months – a total just under $25 billion.

Links:
MBIE, Auckland housing accord
Final accord report
Mingtiandi, 17 January 2017: No capital controls here! China’s CIC set to boost US investments in 2017
Daily Reckoning, 17 January 2017: China’s bogus currency war promise
Trading Economics: China foreign currency reserves

Earlier stories:
23 December 2016: 48% of net migrant inflow stops in Auckland
2 November 2016: National policy statement on urban development capacity takes effect in December
1 November 2016: Auckland share of new home consents drops, intensive ratio holds

Attribution: Statistics NZ, MBIE, Mingtiandi, Daily Reckoning, Trading Economics, ministerial release.

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Intensive housing moves further ahead in suburbs

Suburban intensification moved further ahead of the apartments & retirement village sectors in number of building consents & market share nationally in 2016.

Statistics NZ’s figures for October, released on 20 December, show a 2771 gain in consents for new houses in the 12 months to October, apartments up 154 to 2491, retirement village unit up 152 to 2034, suburban townhouses, flats & units up 702 to 4267.

Those figures show small shifts in market share from the previous 12 months – houses up 0.35% to 70.85%, apartments down 0.6% to 8.26%, retirement village units down 0.4% to 6.74%, and a 0.65% gain by townhouses & units.

Over the 5 years since the 2011 market downturn, however, the changes are more seismic. The standalone housing sector has lost 10% market share, down from 80.7% at October 2011 to 70.85%. Apartments have picked up nearly 5% over the 5 years from a starting point of 3.44%, the retirement village sector lost 1.3% from just over 8%, and the townhouse & units segment of the market has gained 6.35% from 7.8% 5 years ago.

Consents for new homes nationally in the October 2011 year totalled just 13,615, of which houses contributed 10,992 consents. Move forward to the October 2016 year, house consents were up 94% to 21,369; apartment consents rose 432%, from 468 to 2491; retirement village units rose 86%, from 1093 to 2034; and townhouses & units rose 302%, from 1062 to 4267.

Earlier story:
20 December 2016: Consents breach 30,000/year mark

Attribution: Statistics NZ.

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Consents breach 30,000/year mark

Consents for new homes fell just short of 30,000/year in September but made it over that mark in October for the first time in 11 years.

Statistics NZ said yesterday the 30,161 consents for the year were over twice the number at the post-global financial crisis market bottom in 2011 (13,615 in the October 2011 year, which was a 60-year low), 10,000 short of the all-time high of 40,000 reached in early 1974 and 3000 short of the 29-year high in mid-2004.

Statistics NZ business indicators senior manager Neil Kelly said: “One-third of the homes consented over the past year were in Auckland. That’s almost 10,000, compared with 9000 in the previous year.

“Canterbury & Waikato also feature quite prominently in these statistics, although in Christchurch the post-quake residential rebuild is slowly winding down.”

Compared to a year ago, Auckland’s 9947 consents for the latest 12 months represented 32.98% of national consents, up in number from 8935 but down in market share from 33.87%.

Nationally, the 30,161 consents for the year were up 14.3% from the previous 12 months’ 26,382.

For the month of October, consents nationally were up 9.6% on a year earlier at 2575 (2349). The latest figure was up 25 on September but down on consents in the previous 3 months.

Auckland consents for October totalled 792 (805 a year earlier).

Around the region:

Rodney: 61 (63), 929 (778)
Albany: 205 (289), 2216 (2242)
North Shore: 25 (13), 621 (290)
Waitakere: 52 (29), 624 (461)
Waitemata & Gulf: 12 (35), 1038 (1339)
Whau: 13 (9), 311 (254)
Albert-Eden-Roskill: 67 (57), 635 (412)
Orakei: 23 (21), 359 (377)
Maungakiekie-Tamaki: 42 (74), 319 (493)
Howick: 25 (40), 573 (540)
Manukau: 30 (40), 401 (362)
Manurewa-Papakura: 120 (77), 1058 (817
Franklin: 117 (58), 863 (570)

  • I won’t have a chance to finish this item until this afternoon, when it will include sector figures & dollar calculations.

Attribution: Statistics NZ tables, graph & release.

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Rise in homebuilding slows

Statistics NZ said yesterday the volume of residential building work rose 2.4% in the September quarter. That’s down from rises of 5.7% in the June quarter and 5.6% in the March quarter.

Statistics NZ business indicators senior manager Neil Kelly said residential building activity was up in all 3 quarters, but non-residential was unchanged in the September quarter. Overall activity grew 1.4% in the September quarter.

Mr Kelly said overall volume had doubled since the low point of the cycle in the September 2011 quarter to $5.2 billion in the latest quarter – $3.3 billion residential, $1.9 billion non-residential.

Compared to a year ago, Auckland was up 32%, Wellington 21%, Canterbury 4.3%, and 27% in Waikato & the rest of both islands. Residential continued to grow strongly in Auckland but flattened in Canterbury.

Link:
Value of building put in place: September 2016 quarter

Attribution: Statistics NZ release.

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Auckland share of new home consents drops, intensive ratio holds

2550 consents for new homes were issued nationally in September (up 13.7% from 2242 a year earlier) and the tally for the September year rose 14.3% to 29,935 (26,185).

The article below gives you a different twist on many of the figures issued by Statistics NZ yesterday in its monthly building consents report.

In Auckland, 752 consents were issued in September, up 17% on the 643 for that month last year. For the September year, Auckland consents rose 14.2% to 9960 (8721).

Consents for new homes nationally slipped 9% in September from the levels of the previous 3 months, but were up 10% on the average over the March-October period last year. In Auckland, the consent level fell 24% below the average of the previous 3 months, 993.

In a period of change, consents jump, stabilise, jump again. Through those 8 months last year, the national monthly tally ranged from 2000-2350, with one outstanding month, July, when 2824 consents were issued. The number jumped over 2800 again in November, but at the start of this year was around 23-2400/month, rising to 2500 in May then averaging 2800 over the 3 months June-August.

Auckland consents, as a proportion of the national total, fell from 35.5% over the 3 months June-August to 29.5% in September.

After 3 strong years coming out of the 2011 bottom of the global financial crisis decline, 2015 was quieter and consents have picked up again in 2016 – slower in Auckland & Christchurch, but stronger in many other parts of the country such as Whangarei, the Kaipara, Hamilton, Tauranga & Western Bay of Plenty, Wellington & Queenstown.

The rise in number & total floor area have been more closely matched in the last 12 months than in any of the previous 4 years (a 14.3% rise in number and a 14.8% rise in floor area), but the value rise is further out of step than in any of those previous years.

Staged developments can skew these figures because of the way money & buildings are counted. But, for the September 2012 year, consents rose 18.5%, floor area 21.9% and value 25.7%. The growth in floor area fell behind the growth in number in the last 3 years (ie, on average smaller), while the total value carried on rising. For the latest 12 months, the number rose 14.3%, floor area 14.8%, but value rose 23.7%.

For the month of September, the number rose 13.7%, floor area 11.1%, but value rose 18.2% – so, more homes, less space, higher cost.

A higher ratio of apartments generally means less space overall. These days, Statistics NZ breaks new homes into 4 categories – houses, apartments, retirement village units and (suburban) townhouses, flats & units.

Numbers in all 4 categories have grown in a range of 12.8-14.8% in the last year, but far differently for the month – shown below for the month then year, percentage gain, and last year’s figures in brackets:

Houses: 1892 (1781), 6.2%; 21,299 (18,555), 14.8%
Apartments: 206 (109), 89%; 2506 (2207), 13.5%
Retirement village units: 59 (106), -44.3%; 2037 (1793), 13.6%
Townhouses, flats & units: 393 (246), 59.8%; 4093 (3630), 12.8%

The last 3 categories fit the general description of intensive. For the last year of the global financial crisis and the first 2 years coming out of it (2011-13), consents for intensive development represented 19.1% of all consents for new homes (2576 units), falling to 18.9% (3017) & 18.6% (3668).

In the next 3 years, development in the intensive sectors ramped up in number and as a share of all consents for new homes. Those 3 September years:

2014: 6108, 25.3%
2015: 7630, 29.1%
2016: 8636, 28.9%

Around the region

Last for housing consents, around the Auckland region (from north to south) and some other spots around the country. First, Auckland, consents for this September & last, and for the September year & previous year (and it’s the first time I’ve done this second part of the exercise):

Region: 752 (643), 9960 (8721)
Rodney: 64 (86), 931 (777)
Albany: 206 (179), 2300 (2109)
North Shore: 110 (20), 609 (306)
Waitakere: 47 (39), 601 (483)
Waitemata & Gulf: 33 (33), 1061 (1357)
Whau: 14 (10), 307 (257)
Albert-Eden-Roskill: 15 (22), 625 (372)
Orakei: 15 (15), 357 (381)
Maungakiekie-Tamaki: 20 (13), 351 (425)
Howick: 32 (29), 588 (562)
Manukau: 29 (59), 411 (358)
Manurewa-Papakura: 91 (91), 1015 (798)
Franklin: 76 (47), 804 (536)

Other spots:

Whangarei: 46 (45), 616 (420)
Kaipara: 30 (20), 247 (172)
Hamilton: 116 (124), 1224 (1080)
Tauranga-Western Bay of Plenty: 177 (164), 2270 (1468)
Wellington region: 254 (104), 1595 (1206)
Christchurch, Selwyn & Waimakariri: 403 (444), 5768 (6343)
Queenstown-Lakes: 84 (65), 961 (731)

Totals

Consents for additions & alterations were worth $169 million in September ($156 million), up 8.9%; and for the year, $1.824 billion ($1.721 billion), up 6%.

The value of all residential building consents for the month was $1.062 billion ($911 million), up 16.6%; and for the year, $12.2 billion ($10.1 billion), up 20.7%.

Consents for non-residential buildings were worth $509 million for the month ($619 million), down 17.8%; and for the year, $6.05 billion ($5.67 billion), up 6.8%.

Total consents, including non-building construction, were worth $1.598 for the month ($1.565 billion), up 2.1%; and for the year, $18.7 billion ($16.23 billion), up 15.3%.

Attribution: Statistics NZ tables.

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Home consents value tops $10 billion/year, and value/unit soars

Statistics NZ said today the annual value of building consents for new homes exceeded $10 billion for the first time in August, but the number of consents still fell short of 30,000.

The moving annual total for new homes rose by $288 million in August to $10.255 billion, and the moving total including additions & alterations rose by $318 million to $12.064 billion – annual gains of 24% for new homes, 21% including alterations.

The number of consents was up 3699 (14.3%) on the previous year to 29,627. From the low point of 13,516 in 2011, annual consent numbers have risen by 2200, 3700, 4600, 1900 and now 3700.

In addition, alterations were worth $1.1 billion in the August 2011 year, but have risen to $1.8 billion in the last 12 months.

Statistics NZ business indicators senior manager Neil Kelly said today: “Consent values are the highest they’ve ever been. However, in terms of the numbers we’re still not building quite as many homes as we did around 2004, and are still well short of the building boom in the mid-1970s.”

In Auckland, the 9851 new homes consented in the August year (8615 the previous year) were worth $3.84 billion ($2.79 billion) – a 14.3% rise in number, but a 37.7% increase in value.

Mr Kelly said consents had increased in all North Island regions in the last year but the picture for the South Island was mixed. Canterbury consents fell as the residential rebuild started to unwind, but the number rose in Otago.

Consents for new homes were valued at $1.013 billion in August, the first time the $1 billion mark had been exceeded.

Around the Auckland region for August compared to last August: Rodney had 72 (54) consents, Albany 242 (219), North Shore 35 (18), Waitakere 68 (43), Waitemata & Gulf 49 (20), Whau 73 (22), Albert-Eden-Roskill 117 (10), Orakei 21 (30), Maungakiekie-Tamaki 45 (89), Howick 42 (73), Manukau 20 (43), Manurewa-Papakura 112 (48), Franklin 74 (72).

The breakdown of residential consents for the month was: houses 2015 (1617 last August), apartments 232 (65), retirement village units 72 (266), townhouses & suburban units 515 (343).

Consents for all construction (including alterations, and civil works) rose 8.2% for the month to $1.75 billion ($1.6 billion), 17% for the year to $18.7 billion ($16 billion).

Attribution: Statistics NZ tables, release & graph.

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