Building consents on the rise

Housing consent figures remain strong, supported by a low interest rate environment, economists say.

There were 35,472 houses consented for in the year to the end of July, Stats NZ has reported.

While that is a rate not seen in almost 45 years, it is still not the record recorded in the year to February 1974.

The number of new homes consented increased 8 per cent in the year ended July 2019 compared with the previous July year, boosted by records in both Auckland (14,236) and Waikato (4102).

‘‘Canterbury also consented more new homes in the July 2019 year than the previous year. While below the peak of 2014, the level of new homes consented was above those seen prior to earthquake rebuild activities that began in 2011.’’

Otago and Manawatu¯ -Whanganui were the only regions with negative growth in consent numbers, down 28 per cent and 23 per cent on an annual basis respectively.

On a per-month basis, consents declined in June and July after a strong lift in May.

Andrew Beattie, an economist at Infometrics, said the rate of consents was double what it was in 2012 as construction activity increased to tackle a housing shortage.

‘‘We expect the number of consents to keep growing throughout the rest of 2019 despite easing population growth, providing a good opportunity to rebalance the housing market.

‘‘Fewer consents and weaker house prices are expected in 2020 as underlying demand eases.’’

ASB economist Jane Turner said it was likely that building activity was close to a peak. She said underlying demand was high and low interest rates would help that to continue.

‘‘We expect the housing market to benefit from a pick up later this year, underpinned by lower mortgage rates, which should provide additional support to house building demand.’’