Construction industry consents remain firm

Media Release
July 30, 2007

Construction industry consents remain firm

New housing consents for June 2007 showed a significant increase of 29% on June 2006 – the highest monthly total since March 2005. Of the 2574 consents authorised in June 2007, 561 were for new apartments. The largest regional increases were recorded in Auckland, Wellington and the Waikato.

Statistics New Zealand’s report today showed that the value of June 2007 consents was $692 million, a significant increase on the $564 million for this time last year. “This is in keeping with the recent trend of increasing value of residential properties being built,” says Registered Master Builders Chief Executive Pieter Burghout.

Total year to date residential consents are sitting at 26,538 for the 12 months to June 2006 – up from the 25,563 consents recorded for the previous June year.

Non-residential buildings for June 2007 showed a seven percent decrease of $31 million on June 2006. Hotels and other short term accommodation showed the biggest drop, although there were increases in shops, restaurants and taverns.

Taken as a whole, the June 2007 consent numbers reflect a firming of the construction market, which is positive for the industry.

“As mentioned by the Prime Minister recently, it’s important we keep the levels of new housing supply at a reasonably high level given the positive effect this has on housing affordability,” Mr Burghout says.

“We’re hoping that the Reserve Bank Governor’s lift in interest rates last week has sufficiently dampened the real estate market without unduly compromising the strength and performance of the construction market. We will have to wait a few months to see whether or not the consents data available in August/September show that to be the case.”

ENDS

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