Budgeting for KiwiBuild
Budgeting for KiwiBuild
There was buzz in the air after the budget was announced as members of the New Zealand Chinese Building Industry Association (NZCBIA) held a mid-year gathering in their club rooms on Budget Day with 140 construction industry executives debating the government‘s KiwiBuild initiative to build 100,000 affordable homes. The reality of the housing crisis is hitting the government hard and there were cheers of their mini-budget last December with Treasury’s prediction that KiwiBuild investment would hit $5b for residential investment by 2023. There is confusion in the industry after the budget was revised down to $2.5b; though a MBIE statement Impact of KiwiBuild on residential investment showed $4.8b - $11b in the period 2018-22.
The real estate market is stable, though construction is not keeping pace with population increases. Frank Xu, President of the NZCBIA reviewed 2017’s Auckland Unitary Plan and said members reported home prices in Silverdale, West Auckland and Flat Bush had been declining. The developers present are optimistic about the future and supportive of the KiwiBuild initiative. Changda, Avanda and Project NZ can offer innovative solutions but still undecided about lodging their interest to participate. They are considering a joint application to utilise NZCBIA membership’s collective expertise and resources. Pre-fab is an option to contain contractors cost, along with standardisation using technology to improve productivity; though there should be a certification system to ensure high standards. They will address the skills shortage with a recommendation to refine the skilled migrants programme in the short term, with a long term view to inspire young Kiwis to train as apprentices in the construction industry.
The NZCBIA has created a platform with its Annual Conference and Expo that has attracted the support of PlaceMakers and Avanda’s William Guo. As Director, Mr. Guo has used many of the association’s resources and referrals the past four years since opening the NZ office. He said even though there is demand, “It’s a challenge to be a developer with some large Kiwi construction companies operating at a loss because of delays leading to budget overruns, especially with the labour shortage and inconsistent levels of expertise.” The NZCBIA network has helped Avanda to build its brand and credibility in the local market with the launch of its Onehunga Bay Terraces project that will be promoted at the Expo.
Shane Watkin, PlaceMakers Regional Manager addressed the audience expanding on their corporate objectives for partnering the NZCBIA with a dedicated “PlaceMakers Zone of its preferred suppliers in one place to save customers time and money, along with workshops to upskill the trade and consumer education during the Conference and Expo”. Last year’s Expo proved successful with over 8,000 visitors during the two days.
There is doubt the building industry can house people affordably and fund infrastructure but there was optimism in the room that it could happen with the support of the NZCBIA network working closely with the government to ensure it is mutually beneficial. –END-
About NZCBIA http://nzcbia.org.nz/
New Zealand Chinese Building Industry Association (NZCBIA) is a non-profit membership group with the vision of uplifting New Zealand building industry standards by providing a useful platform for Kiwi companies, local ethnic Chinese businesses along with companies from China to work together for New Zealand’s thriving property development and building industry.