New faces but not enough places

Residential building consent numbers dropped another 5% in September to the lowest levels before the pandemic.

Over the past 12 months, just over 40,000 new dwellings were consented, down 20% on the previous year. The fall in consent numbers has been widespread, including Auckland, down 22%, Wellington, down 18% and Canterbury, down 17%.

The downturn reflects much tougher financial conditions in the sector where there have been large increases in building costs, a sharp fall in house prices, as well as continued increases in interest rates.

Against that backdrop, developers have been reluctant to bring new projects to market, and prospective buyers have been nervous about making purchases.