Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Volume of building activity falls in June qtr

Volume of building activity falls in June qtr; demand seen strong


By Rebecca Howard

Sept. 5 (BusinessDesk) - The volume of building activity fell more than expected in the June quarter but ongoing demand – in particular for residential housing – is expected to support the sector.

The total volume of building activity fell 1.5 percent in the June quarter after lifting 5.7 percent in the March quarter, Stats NZ said.

Economists polled by Bloomberg had expected a 1.3 percent lift.

ASB Bank senior economist Jane Turner lowered her second-quarter gross domestic product forecast to 0.4 percent from 0.6 percent after the data.

“While the softer-than-expected result may weigh on growth in Q2, we expect that continued housing construction demand will provide more support to growth over coming quarters,” she said.

The volume of non-residential building activity fell 3.4 percent, after accounting for typical seasonal patterns and higher construction costs, Stats NZ said.

This followed an 8.2 percent increase in the March quarter.

“Although the value of building work put in place continued to grow this quarter, the volume of activity failed to keep up with previous seasonal increases, especially after a very strong March quarter,” construction statistics manager Melissa McKenzie said.

Residential building activity eased 0.2 percent after rising 4 percent in the March quarter.

ASB's Turner noted that quarterly growth in residential construction activity has become slightly more difficult to forecast due to an increased share of apartment and town-house construction over the past year as these projects can be more complicated and lumpy compared to constructing stand-alone houses.

“Residential building consents have proved surprisingly strong and resilient over 2019 and suggest plenty of house building activity remains in the pipeline for the construction sector,” she added.

The data comes just after Housing Minister Megan Woods unveiled the long-awaited KiwiBuild reset that includes the creation of a new 'shared ownership' initiative that will allow a would-be homeowner to buy part of a house, in partnership with "long term institutional investors", including community housing providers and iwi.

It also lowered the requirement for a 10 percent deposit to 5 percent when applying for what has been called until now a KiwiSaver HomeStart loan. It will now be known as the First Home Grant.

Also, there will now be no cap on the size of a First Home Loan that can be accessed when a group of people clubs together to buy a home together.

In value terms - not adjusted for cost changes or seasonal effects - the actual value of total building work in the June quarter was $6.2 billion – up 11.8 percent from the June 2018 quarter.

In the year ended June 2019, the national value of building work was $24.3 billion, up $2.3 billion, or 10 percent from the prior year.

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Non-Giant Fossil Disoveries: Scientists Discover One Of World’s Oldest Bird Species

At 62 million-years-old, the newly-discovered Protodontopteryx ruthae, is one of the oldest named bird species in the world. It lived in New Zealand soon after the dinosaurs died out. More>>

Rural Employers Keen, Migrants Iffy: Employment Visa Changes Announced

“We are committed to ensuring that businesses are able to get the workers they need to fill critical skills shortages, while encouraging employers and regions to work together on long term workforce planning including supporting New Zealanders with the training they need to fill the gaps,” says Iain Lees-Galloway. More>>

ALSO:

Marsden Pipeline Rupture: Report Calls For Supply Improvements, Backs Digger Blame

The report makes several recommendations on how the sector can better prevent, prepare for, respond to, and recover from an incident. In particular, we consider it essential that government and industry work together to put in place and regularly practise sector-wide response plans, to improve the response to any future incident… More>>

ALSO:

Oil Scare: Trump Authorises Use Of Emergency Crude Stockpile

The New Zealand dollar fell against the US dollar after President Donald Trump authorised the use of the country's emergency crude stockpile after the weekend attack on Saudi Arabia’s major oil facilities. More>>

ALSO: