Lockdown spurs home renovation bonanza
Builderscrack, an online jobs board for building work, says there was a near-30 per cent jump in work posted on its website in June.
‘‘June saw our highest ever number of jobs posted on our platform at just under 8000 for the month,’’ managing director Jeremy Wyn-Harris said. ‘‘We are definitely seeing a boom in repairs and renovations.’’
The type of work was also changing, with an increase in larger value jobs such as extensions, decks, fences and moderate to large improvements being advertised.
Alan Martindale, a renovations builder in Beach Haven, Auckland, said he had ‘‘definitely’’ seen demand for his services increase. ‘‘Currently I’ve got three months’ work backed up. Because they’ve spent time in their homes, I think people have looked at their houses and said we could do this or that. The possibilities became more apparent.’’
Retailers were benefiting too. Richard Low, managing director of Flooring Xtra, said sales for carpet and wood flooring had been exceptionally strong, even online inquiries over lockdown.
‘‘Most of the carpet retailers have been flat out,’’ he said.
The big problem was now getting in the stock, he said. ‘‘Carpet manufacturers have to predict production and they just had no idea we would sell so much.’’
Many retailers have reported similar shortages. Retail NZ chief executive Greg Harford said 41 per cent of his members in a recent survey had experienced supply difficulties due to post-Covid logistics disruptions.
Stuart Masson, branch manager at Plumbing World Lower Hutt, said retail sales had been going ‘‘ballistic’’ since lockdown. ‘‘We expected a three-month period where sales were gangbuster while people try and catch up and that’s certainly the case with regard to commercial, but what we didn’t anticipate was the dramatic increase in the renovations side of things. Which is obviously a nice bonus.’’
People were telling him that they were channelling money they would have spent on travelling into their homes instead. ‘‘Or they’re uncertain about the future so instead of buying a new house, they’re looking at doing up the existing.’’
Westpac senior economist Satish Ranchhod said he had heard a lot of anecdotes about people spending up on home renovations.
But once existing projects are finished, most economists are expecting building work to slow, particularly in commercial construction.
Although building consents in May rebounded sharply from low lockdown levels, ANZ senior economist Liz Kendall said that was ‘‘inevitable,’’ and she predicted a weakening trend ‘‘on the other side of this’’.
Independent economist Tony Alexander said the effects of Covid-19 would be lagged.
‘‘I think they’re going to find a bit of a hole in a few months’ time, mainly 2021, because we know the banks have pulled back on financing and property developers.
‘‘Because that’s what they always do when you get a recession come along, you get rid of what the riskiest sector is out there.’’
A downbeat NZIER quarterly survey of business opinion this week confirmed confidence in the building industry was low, with 75 per cent of building firms expecting the economy to worsen over the next year.
NZIER principal economist Christina Leung said investment intentions in the wider business sector had fallen, and bank finance was getting increasingly tight, which would eventually put downward pressure on builders’ profits and prices.