This article is from the Australian Property Journal archive
A surge in apartment consents has boosted building approvals number in New Zealand, according to Statistics New Zealand, 2,237 consents were issued in February 2006, an increase of 12.4% following a fall of 10.9% in January.
According to Statistics New Zealand, in February 523 consents were issued for apartment units.
In addition, over the last three months apartment unit consents have averaged 22% of new dwelling unit consents issued, compared with a monthly average of 15% for the year ended February 2006.
The trend for the number of new dwelling units, excluding apartment units, has been relatively flat in recent months, following a decline from the high levels of 2003 and 2004.
Consents for 1,714 new dwelling units, excluding apartment units, were issued in February 2006, 104 less than in February 2005.
For residential buildings, the value of consents issued in February 2006 was $561 million, $15 million higher than in February 2005.
The value of non-residential building consents issued during February 2006 was $290 million, down $26 million from February 2005.
The largest contributor to the February 2006 value was offices and administration buildings, at $62 million.
J.P. Morgan Securities Australia’s economist Jarrod Kerr said activity in New Zealand’s housing market has a close correlation to net permanent migration.
“The surge in construction and house prices experienced over 2001 to 2004 was stimulated by a massive influx of immigrants post September 11. The trend is now reversing as the strength of the global economy is encouraging Kiwis to move offshore and the inflow of students from Asia is slowing,” he added.
Kerr said residential construction will continue to moderate throughout 2006 and house price inflation will slowly turn to deflation.
“New Zealand’s housing market already is cooling under the weight of high interest rates, and household’s are loaded up with debt.
“As a result, JPMorgan forecasts sub-par economic growth of just 1.3% for 2006 as household’s repair their balance sheets,” he concluded.
By Kathryn O’Meara
