The number of new homes being built in Auckland appears to be averaging out at just over 15,000 a year, down 21% from the peak of around 19,000 achieved 12 months ago.
However, Auckland new home completions are still around 50% higher than they were back in 2019. (See the graph below for the trend).
The latest Auckland Council figures show it issued Code Compliance Certificates (CCCs) for 15,343 new dwellings in the 12 months to August this year.
CCCs are issued when a new building is completed and are therefore the best indicator of actual new housing supply, unlike building consents which are issued before construction starts and are an indicator of likely future supply.
The average number of new dwellings completed in Auckland each month peaked at 1630 in May last year, then declined steadily to 1279 in August this year.
However, that slide in completions has almost levelled out, and between May and August this year the number of CCCs issued declined from 1296 to 1279, a drop of just 17 over that period.
Between July and August this year, the number of CCCs issued was as flat as you could get, with 1280 issued in July and 1279 in August.
That suggests the slump in new dwelling completions in Auckland has bottomed out, and there was some good news for Auckland's residential construction market in the latest building consent figures.
These showed a sharp jump in new residential building consents, with 1627 issued in Auckland in September, up from 1376 in August and 1362 in September last year, giving an annual increase of 19.5%.
That should signal and increase in building activity in the region as work gets underway on the new projects, although it's likely to be around a couple of years before that starts to show up in the new completion figures.
3 Comments
Quite a high number given weak immigration
A lot of new land supply (mostly exurban) was added to Auckland in late 2018, in 2021 development rules were freed up in a bi-partisan agreement and interest rates were slashed during Covid. All of these lowered building costs and more housing got built.
Interest rates skyrocketed with post-Covid inflation, the Luxon government broke from the agreement and just last week Wayne Brown announced there will be no more greenfield land added to Auckland for 20+ years. All of this increases the cost to build.
Auckland is reverting to type, where they try to make the rich richer by inflating the value of urban land to $infinity.
Welcome to pretty much every modern city. Even Singapore engineers it's public leasehold apartments in such a way as to undersupply and keep prices high.
And yet
Cities are generally growing, and cheaper smaller population areas are emptying.
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