Building consents stall in December amid falling home sales

There were 1,260 new dwelling consents, excluding apartments, issued in December, according to Statistics New Zealand, down from 1,458 a month earlier when new issuances rose a seasonally adjusted 2.8%.

The value of residential building consents fell to $494 million in December from $537 million in November, though it rose 12% from the same month a year earlier.  

"Against the backdrop of weak existing home sales volumes, the data is not painting a picture of vibrant recovery in residential construction" said Bernard Doyle, strategist at Goldman Sachs JBWere. "A robust residential recovery underpins our GDP growth forecasts for 2010 - to the extent it doesn't emerge, it will feed back into monetary policy settings." 

During the same month, house sales dropped to a "concerning" 4,957, according to Real Estate Institute data, and economists are wary that last year's revival in the housing market, driven by returning expatriates and new migrants, hasn't been as strong as previously suspected.