New homes, public sector buildings and the Auckland economy kept the construction sector bubbling in the June quarter, as activity in Christchurch continued to slow.
Most sectors in Statistics NZ’s gauge of building work put in place are small enough for 1-2 projects to make a big difference in percentage terms. Broadly, from the bottom of the global financial crisis in 2011-12, activity picked up strongly through 2013-14, followed by a lull for the first 3 quarters of 2014, picking up again in the latest 3 quarters.
The total output in the June quarter was 21.1% ahead of that quarter in 2015 – new dwellings up 26.4%, accommodation buildings up 33.1%, education buildings up 27.2%, commercial buildings up 22.3% compared to a year earlier.
Industrial buildings picked up after 3 lukewarm quarters – down 5.4% in the September quarter, up 8.9% in December, down 15.4% in March and up 12.9% in the June quarter.
In Auckland, those 3 quiet quarters last year make the subsequent performance look strong – a 7.7% rise in the March 2015 quarter, on top of a 28.6% in the March 2014 quarter, was followed this March by a 25.6% rise in activity. Activity was strong in the June 2014 quarter, up 29%, followed by a 4.3% rise last June and a strong lift again, up 39% in the June 2016 quarter.
In dollar terms, the value of work on new homes in the latest quarter was 84% higher than 3 years earlier – $2.56 billion (excluding gst) versus $1.39 billion. For the June year, the value of $9.33 billion was up $1.3 billion (15.9%) on the previous year, and up 122% ($5.13 billion) on activity in the June 2012 year.
The steep rise in residential activity over those 4 years hasn’t been matched in non-residential sectors. The total of all residential work, including additions & alterations, was just over double the level of 4 years ago – up from $5.5 billion to $11.4 billion – but non-residential work has risen over 4 years from $4.45 billion to $6.63 billion, an increase of 49%.
Quarterly activity in Christchurch has exceeded $1 billion since September 2014 ($1.16 billion in the latest quarter, up 6.5% on a year earlier).
Auckland went above the $1 billion/quarter mark in the September 2013 quarter and, in the latest quarter, the $1.83 billion of construction work was $1 billion above the level at the bottom of the market in 2011-early 2012. It’s also up $500 million on the level in June 2015.
Attribution: Statistics NZ tables.