Statistics New Zealand figures show nationwide building consents have more than doubled in the last seven years, though the total for 2018 of 32,996 was below the peak seen in the mid-1970s

Building consents were issued for 32,996 new dwellings in 2018, up 6.1% compared to 2017, according to Statistics NZ.

That means the number of new dwelling consents being issued has more than doubled in the last seven years, since it hit a cyclical low of 13,662 in 2011.

However, consents still remain below their high points of 39,766 set in 1973 and 35,036 in 1974.

But dwelling consents issued to central government agencies such as Housing NZ hit a 40 year high of 1999 last year, the highest number for any 12 month period since the year ended November 1978 when 2105 were consented.

For the month of December 2382 new dwelling consents were issued throughout the country, up 9.8% compared to December 2017. 

Of the 32,996 dwellings consented last year, 21,125 were stand alone houses, 3551 were apartments, 1829 were retirement village units and 6491 were town houses or home units.

In the Auckland market, where housing pressures are particularly acute, 12,862 new dwellings were consented last year, which was the highest number for a calendar year since Statistics NZ started publishing Auckland consent figures in 1991.

Auckland consents have have more than trebled since they hit their cyclical low of 3475 in 2009.

Westpac Senior Economist Satish Ranchhod believes consent numbers are now flattening.

"Looking at Auckland, which accounts for most of the increase in consent issuance over the past year, we've actually seen a levelling off in consent numbers in recent months," Ranchhod said in a First Impressions newsletter on the numbers.

"It looks unlikely that issuance numbers will break signficantly higher over the coming year.

"Similarly, issuance in Wellington and in many other regions has also flattened off in recent months.

"Consent numbers in Canterbury, in contrast, have actually shown unexpected firmness.

"Given the ongoing winddown of reconstruction spending in the region, we have doubts about whether this will continue.

"Overall, we expect consent numbers will remain elevated over the coming year, but we don't expect to see a further significant rise from current levels.

"Consent numbers are now broadly in line with changes in the population."

Building consents - residential

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Building consents - type

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47 Comments

32,996 per annum is not as high as Ireland before their bust, but it's getting up there. I do hope this housing shortage is actually real, and won't be revised down again and again, as the revised recent immigration figures seem to be suggesting might happen.
https://www.interest.co.nz/property/97893/new-figures-showing-population...

Ireland had real migrants ,leprechauns, banshees and merrows.

Great news! Just in time for the start of the downward part of the house price cycle.

We are a one way road to oversupply of high density dwellings at the fringe of the city.

I actually went for a drive through H'ville and Whenuapai over the weekend to look at the open homes out of curiosity. From what I saw, there was a substantial amount of unoccupied completed dwellings and pretty much no open home traffic.

Nek Minnit, too many overpriced houses.

up
10

Actually, don’t we have an undersupply of affordable housing and an oversupply of unaffordable housing currently?? Gee, I wonder what the solution could be?

10 times multiple of household income to the brainwashed on interest only terms for 50 years!

The banks don't really need their capital back. They can be like Landlords, except they don't need to worry about maintaining the properties.

Actually its even better more like slave owners. They own a substantial slice of your future income and any assets up to the value of your debt. They dont have to pay any of your bills, food or put clothes on your back as well but can/will take first cut.

Really they have too much power and the mortgage system needs to become non-recourse loan or other seriously drastic change to re-balance.

Hah.
Well, I think we can be certain that everything will be done to increase the demand side before we see any supply side revision.

Another problem is the CV that was out in 2017 - that in itself went up by 40% to 65% now many houses which have a CV of 1.2 or 1.3 Million are not going even for a Million (Strugglinf) and that too in good areas Like Pakurana and nearby (support little bit is coming from CV as vendors are resisting selling much below CV but for how long ?)

Vendors are also not at fault also, as with CV their expectaion is very high, earlier (During Boom/ Speculation/money Laundering)was fine as property where going at any price but now is hard to get the 2016 price for many property currently in market and were purchased in 2016 (Which are those properties, please check listing with history from QV or homes.co.nz but now days homes.co.nz does not shows history of all but QV website may- why ? do not know) and beyond or are just manage so hard for many to sell and good opportunity for FHB butthey mighthave to wait a little now as will know shorlty the direction that NZ, particulary Auckland housing market will take.

So wait and Watch.

In more normal cities the higher density would be developed in more central locations,but Auckland does prefer to spread things outwards.

Happens when inner suburb libertarians stop being libertarians, once the rubber hits the road.

This is the issue you have with boom and bust housing cycles where the demand and supply cycles are out of sync with one another.

This is due to monopoly restrictions in land release, consenting and development that don't allow the demand to match the supply, both on the way up in a boom and on the way down in a bust.

In housing jurisdictions that have truly affordable housing, supply can very quickly match demand, both up and down to such an extent that any possible oscillation is flattened right out, ie becomes a stable market consistent over time.

Dale, where are these jurisdictions that have supply quickly matching demand?

Tokyo, Houston, Vhicago, Montreal, Vienna to name a few. Can’t think of any in NZ?

Christchurch, perhaps.
But that's pushing it.

Yes it is pushing it, as what started Christchurch off was the earthquakes, and Selywn and Waimak councils ability to cannibalize the inaction of Christchurch City Council.

But what we are seeing is the same out of sync. demand and supply oscillation, remember that these type of oscillation do cross paths, one cycle going down crossing over the other one coming up.

At this cross over point, for a moment in time (could be months, or year depending on the wave length) it looks like supply and demand are in balance. Just like a stopped clock is right twice a day, it gives the wrong impression as to what future reality will be.

Christchurch still runs under the same dysfunctional land regulation system and consenting process as the rest of NZ, and it will lowly revert to norm. over time.

Correct Withay, but also if its within the city then it is normally within the Country or state as well, depending on which entity control land regulation. So your list would read Japan, Texas, Illinois, Quebec, Austria

Japan famously has had a volatile housing market, strewn with bubbles.

Is this the Beginning of a Globalized Housing Downturn?

https://www.youtube.com/watch?v=ZzCIPheGm5c

Something to ponder on.
1974/75 there was a big spike in building for the babyboomers as seen above...born from 1950 onwards.
those born in 1950 birth year are now approaching 69. Average life expectancy in NZ is 81. People don't need houses when they pass away so over the next decade or so not only will New Zealand be seeing the impact from all this wonderful (actually some of it is quite questionable) new supply, but will also see supply from the 1970's boom in building with returning stock from all those that no longer need a house.
The banks and RE sector are going to have to increase their advertising hype on this (what was it they increased advertising by 25% last year) to have any chance of keeping this bubble alive.

Actually the boomers were until 1960s and many are around 55 years old so Nic your theory probably doesn't stack up sorry about that.

Errm, Boomers were from 1946 - 1964, so the earliest boomers are in their early 70s already, so yes, they are probably starting to drop off at an increasing rate now. My mother & her siblings span the boomer age range, and two have passed already.

Sloppy stats Nic. While the 2016 life expectancy was 81.61 years, that is not the life expectancy of someone who is 69 today. Fisher funds have those expectancies as follows: a median male 69 year old living to 86.9 years and female to 89.4 years. The oldest Boomer male (born 1946) on average could expect to live until 2033, dying at 87.4 years old.

BOOMER, is possibly the sound going off in your ears right now nic

Hi. Ex Expat
Stats are spot on for 2016 rather than a projection of what might happen for the current 69 year old who made it this far.
Have you ever considered as well that the X'ers may not live as long as the Boomers, because despite advances in medicine they have had to work so much harder than the Boomers to pay for all the retirement promises and accumulated debt.. One earner working from 9-5, tea on the table at 5.15. 9 holes before bedtime... Not anymore! Life expectancy is life expectancy, extra work, longer hours and more stress could pull that backwards in future (who knows what the impact of modern life will be)
... Yes you've possibly hit 69 (born in 1950 perhaps) but many don't and nor have many others that were born in 1951. You can't say I've got to 69 so I'll live another 20 years without considering all those poor sods who didn't make it as far as you have. You shouldn't pick and choose stats like that and you are neglecting a reasonable point made above, that the early building boom in the mid 70's produced stock that many boomers are still sitting in today, often larger units too, in my opinion this will magnify the extent of the correction at the upper end of the market as the need to fund retirement increases the availability of these larger unit sales. Lots of boomers still carrying very heavy 'negatively geared' mortgages.
interesting times ahead Ex Expat
Nic

Sorry Houseworks old chap, but once agin you're wrong - Boomers are 1946-1964.. you're thinking the start of generation X in 1965 who are now 54.

Our population bulge actually begins with birth year 1950 and gets bigger and bigger for the next decade. My theory is very plausible and a lot of them are very highly leveraged still.

"agin" hahahaha, I am NOT wrong AGIN but maybe you are Nic, I said many would be 55...not 54... you should get your eyes tested or have another gin perhaps

*Scoff* Median Prices don't mean anything! Didn't you hear?? Asking Prices are up 0.5% in Auckland!

Lots of excuses in the article about why the prices are falling. No investigation or evidence to back the claims. Now apartments are the source of blame, even in Remuera?

Perhaps people will feel more enthusiastic about property if they pay to go to a property seminar to receive brainwashing.

The comment you are quoting is specifically related to New Market which may well have lots of new apartments. Remuera only recorded a drop of 4.3%, much lower than New Markets 7.4%.

Correct. It's evident now that there has been a price drop. New apartments will contribute in areas where they are being built, but not across the board.

Now what will be more interesting is if the downward trend continues.

In any form of asset there is No One Way Street and faster it goes faster it comes down but anyone who is in the market for long Term will not lose.
Whatever the so called experts / media say, will know by March end the direction of the housing market in NZ.
If it stables, the market will be flat for some time with no deep fall but if it falls from here it may be a big fall as High House price in NZ was supported and prompted by Foreign Buyers / Money Laundering / Speculation (Average Kiwi cannot afford house in NZ, more so in Auckland now) so if the above are absent from the market no amount of supply and demand will be able to save the market and in falling market speculators are the first one to jump and book profit/lose.

Christchurch no.s are very stable as it is the desired place to live in Australasia.
Yes too much land has been opened up at one time, but reality is that people are seeing ChCh as undervalued!
Be In as prices are only going to increase!

Oh my. You should read this book.
Into the Mist: Journey into Dementia.
Then see a Doctor to get checked out. I am a bit worried as you are not making sense.

I live in chch and I am not this one-eyed, even when it comes to the 'Saders.

There remains too much supply on the market and potential supply in sections/house and land packages. When credit tightens, chch is going down too (although maybe not as much as more over-priced areas.

Credit has already tightened.
ChCh prices are not going to drop at all.
With new houses continuing to be built that will ensure that the average price is maintained and as the AS Is Where Is houses start to peter out then the average will increase.
ChCh houses are totally undervalued on average and first home buyers are now buying!
Plenty of people also looking for rentals as well.
Prices do not worry us at all, as we don’t normally sell, although we do have one on the market at the moment!

Chch prices are not going to drop at all perhaps reminds me of a conversation I had about 15 years ago with someone who said that Chch would be the safest place to buy in NZ to avoid earthquakes....how wrong we were....

In chch. Commercial office space is tanking. Owners with high pay outs and low debt are in lala land. Deals being done for 60% of asking at the peaks when nothing was available.

Abundant housing supply and scarce opportunities for employment. This is showing up in commercial space with for lease signs everywhere. Real estate jobs taking a hit. Trade jobs gone. IT jobs diminishing. Bank branches closing. What exactly is going to drive the economy? At least Welly has gubmint money.

As land bankers in the outer areas see the demand "flattening" they'll want to cash up. I've seen quite a few green fields up for sale.

I just don't see where the boom is going to come from.

All those kiwis building....

“Westpac Senior Economist Satish Ranchhod believes consent numbers are now flattening.”

Excuse me – but what about the additional 10,000 about to burst through the pipeline?

Just one little thing. Building consents issue are never matched by numbers of dwellings actually built. The figures are associated, of course, but for some reason there is always a shortfall between consents issued and dwellings built.

Are all building consents for dwellings though?

Previous articles from interest.co.nz suggest that they match very veryclosely. From memory around 97-98% so it's close enough.