New year looks good for Otago builders

Otago could next year start experiencing something of a building boom, particularly in the area of non-residential buildings.

Statistics New Zealand yesterday singled out Otago as one of three regions with the most non-residential building work consented in October.

Auckland was top on $174million, Canterbury was next on $88million and Otago was third with $55million.

No other regional breakdown was provided but Statistics NZ said office, administration and public transport buildings were the highest consented throughout New Zealand.

They were followed by education buildings followed by shops, restaurants and bars.

Queenstown-Lakes also fared well in the number of dwelling consents issued in October with 96, up from 65 in September and by far the highest for the past 12 months.

Central Otago had 19 dwellings consented, up from 16 and again the highest total for the past 12 months.

Dunedin slumped to 19 dwelling consents in October from 25 in September.

The highest number issued was the 39 issued in May this year.

Invercargill had an even worse slump from 31 in September to six in October but the 31 was an aberration with the normal figure for Invercargill in single figures for all but one other month in the past year.

As far as value and number of new dwellings consented in October, Otago had a total of 136 consents approved at a value of $54million.

Canterbury had 489 approved at a value of $161million and Southland had 17 at a total of $6million.

Nationally, residential dwelling consents lifted 5% in October.

ASB senior economist Jane Turner said an apartment-induced lift in the October residential consents masked a relatively muted underlying demand.

Some of the weakness stemmed from Canterbury, which was to be expected.

However, a soft growth trend in Auckland house building demand was a development to watch closely, given Auckland's ongoing housing shortages.

''We continue to expect the Reserve Bank will cut the official cash rate to 2.5% in December, largely due to persistent strength in the New Zealand dollar and a subdued inflation outlook.''

Reviewing Statistics NZ figures, Ms Turner said residential consenting in Canterbury softened as housing shortages eased as the rebuilds and repairs from the earthquakes were completed.

The trend in consents issued elsewhere remained positive.

Low interest rates and a lift in population growth - albeit slightly milder than experienced in Auckland - had stimulated housing demand throughout the rest of the country.

Non-residential building consents throughout New Zealand were regarded as weak in October, although given the volatility in the series, that was not surprising, she said.

Consents issued in Canterbury were weak after a recent spike and was an was something to be watched closely in the future.

''Overall, we expect growth in non-residential construction demand to slow but remain positive over the coming year,'' Ms Turner said.

Building and Housing Minister Nick Smith said the latest figures showed the number of building consents in Auckland at an 11-year high, something he welcomed.

''Today's figures are the latest in a recent series indicating the pace of Auckland's new house build rate.''

The National Construction Pipeline Report had projected an extra 80,000 new homes would be built in the six years to 2020, compared to the 30,000 in the preceding six years.

The number of people employed in Auckland's construction industry had increased from 45,000 to 75,000 in the past three years.

The next stage in the Government's programme included advancing new housing on Crown-owned land in Auckland, supporting the Auckland Council in the completion of the new Auckland unitary plan, consulting on a new urban development national policy statement and reform of the Resource Management Act to address the long-term issues affecting housing supply and affordability, Dr Smith said.

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