30 Jul 2009

June building consents hit 44-year low

7:32 am on 30 July 2009

Building consents for the 12 months to June have hit a 44-year low, says Statistics New Zealand.

In June, the number of new dwellings fell a seasonally adjusted 9.5% compared with the previous month, largely because of a drop in apartment building. Excluding apartments, the number of consents rose 3%.

Economists say the figures suggest the housing sector is still struggling despite low interest rates.

For the 12-month period to the end of June, consents issued for all new dwellings reached their lowest number since April 1965.

ASB economist Jane Turner says building activity has been down for some time now.

Consents for commercial buildings fell in June. The value of non-residential building consents was at its lowest level since September 2007 after record months in April and May.

However, consents for houses have risen for three of the past five months, after nine consecutive months of falls.

ASB says housing consents have been slow to rise off their low point. But it expects consents to pick up more robustly in the second half of the year in line with recent signs of a recovery in house prices.

The chief executive of the Registered Master Builders Federation, Warwick Quinn, says the industry is cautiously optimistic there will be a steadier increase in building consents and building activity in later this year and early next year.