NZ building consents rebound in July

Building permits rose a seasonally adjusted 5% in July, according to Statistics New Zealand. Approvals were granted for 1,214 units including 55 new apartments. In June, consents tumbled 9.6%. Core consents for residential property, excluding apartments, surged 11%.  

"Today's consent issuance suggests the construction industry is close to reaching a turning point," said Jane Turner, economist at ASB. "Ex-apartment consent issuance now looks to have made a tentative recovery, following the pick-up in demand evident in house sales." 

Property demand and prices have stabilized after last year's slump in an economy that may be in its sixth and possibly final quarter of recession. Record low interest rates and rising net migration are helping bolster demand. A net 14,500 people entered the country in the 12 months ended July 31, according to government figures. 

"Demand for new housing will be underpinned by the recent increase in net migration," Turner said. Still, "rising unemployment and slow wage growth will moderate the increase in demand as households remain slightly cautious."