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Wellington new home consents halved in April

Press Release – Statistics New Zealand
The number of new homes consented in April 2020 was nearly 17 percent lower than in April 2019. This was the biggest percentage fall in monthly consents compared with the same month in the previous year since July 2011.

A total of 2,168 new homes were consented in April, bringing the number of new homes consented in the April 2020 year to 37,180. This was slightly down from the February 2020 year, which produced a 45-year record of 37,882 new homes consented.

The uncertainty caused by COVID-19 is highlighted in the regional home consent figures. Consents in some regions fell sharply, while others remained relatively unchanged from the previous month. For example, consents in Wellington roughly halved in the month while Canterbury consents held up.

New Zealand was in alert level 4 from near the end of March till almost the end of April, with the closure of non-essential businesses, including construction sites.

There was a large drop in the number of new homes consented in April, reflecting a range of factors. These include the direct impact of COVID-19 on plans to build, as well as any changes to how consents were lodged and processed by councils during the lockdown.

“Ultimately, there is still a large amount of uncertainty around the implications of COVID 19 on the future supply of homes,” acting construction indicators manager Dave Adair said.

“Typically, many homes are built within about a year of gaining consent, but these are unusual times and it will take some time to see if existing consented projects are completed or delayed.”

A clearer picture of the impact of COVID-19 on the construction industry will be provided by ‘Value of building work put in place’ results in the coming quarters. This series measures work actually completed, rather than consents which indicate an intention to build. The data may include insights into delays, cancellations, and the total value of work put in place.

Seasonally adjusted fall in number of new homes consented

In seasonally adjusted terms, the number of new homes consented fell by 6.5 percent in April 2020, following a fall of nearly 22 percent in March 2020.

The number of homes consented each month can vary significantly due to timing of large multi-dwelling projects, such as townhouses and apartment buildings. Results may also be affected by the COVID 19 pandemic and the uncertainty surrounding its implications. We recommend focusing on annual results when looking at changes over time.

Decrease in value of non-residential consents

The value of non-residential building consents dropped to around $364 million in April 2020, which is the lowest value since January 2017. The average monthly value of non-residential building consents in 2019 was around $622 million.

“There is a lot of volatility in the month-on-month figures for non-residential building consents, however the value of consents has been decreasing since November 2019. The long-term effects of the COVID 19 pandemic on non-residential building consents remains to be seen in the future releases of ‘Value of building work put in place’,” Mr Adair said.

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