12 Jan 2018

Annual Auckland apartment consents rise 23 percent

6:10 pm on 12 January 2018

Building consents have hit a 13-year high, new figures show.

Christchurch construction.

Christchurch construction. Photo: RNZ / Alexander Robertson

Stats NZ figures showed consents rose a seasonally adjusted 11 percent in November, after a 10 percent fall in October.

Auckland growth was strong, rising to a 15-year high, led by apartments.

In November 1450 new consents were granted in the city, mainly for apartments.

Westpac senior economist Satish Ranchhod said the data was encouraging.

He said there has been a 23 percent rise in apartment consents in Auckland over the past year.

"If Auckland can sustain the pace we've seen in recent months, it would finally start eating into its significant shortfall of housing albeit, very gradually," he said.

Mr Ranchhod said he expects that the level of residential building activity will remain elevated for a while, but there were hurdles.

"As we've highlighted for some time, rising costs, as well as difficulties sourcing skilled labour and credit have provided a brake on activity," he said.

Stats NZ said November was typically a strong month as people get plans approved before the Christmas break.

Its says the rebound was driven by a rise in consents for apartments, which can be volatile month by month.

There were 3262 consents issued around the country in November, most of them for new houses, townhouses and apartments.

Property Investors Federation executive officer Andrew King said he expected that trend to continue, and the housing shortage had turned a corner.

"The real problem that we've got is that our housing supply isn't responsive enough to demand," he said.

"So there could come a point where demand actually drops off - like, we've got record immigration at the moment - if that drops off we could actually get a situation where we have too many properties."

Mr King said the number of townhouses and apartments being built was helping to boost the figures, but there were still homes being built as well.