Auckland home construction at 10-year high

Building and Housing Minister Dr Nick Smith has rejected data used in a media report published today on the number of homes completed in Auckland under the Housing Accord with Auckland Council, saying the pace of residential construction in Auckland is at a 10-year high and is continuing to grow.

“We are making solid progress in lifting the pace of residential construction in Auckland, with the latest annual building consents at the highest level in 10 years, at 8721. This compares to the low of 3485 after the Global Financial Crisis and amounts to compound growth of 27 per cent, 28 per cent, 31 per cent and 18 per cent in Auckland’s house build rate over the past four years. This is the longest and strongest sustained growth in residential construction in Auckland’s history,” Dr Smith says.

“This strong set of building consent statistics in Auckland is confirmed by other economic data. The number of people employed in the construction industry has increased from 48,000 to 75,000 over the past four years. The GDP data for construction in Auckland also shows strong growth.

“Furthermore, the future outlook for residential construction in Auckland remains strong. The recent National Construction Pipeline Report has projected an extra 80,000 new homes will be built in the six years to 2020 – more than double the 30,000 built over the past six years.”

“The claim that only 102 homes have been completed out of the Accord’s 39,000 target is ridiculous. It is incomplete, misleading and selective. It only counts housing on two Government-funded housing initiatives at Waimahia Inlet and Northern Tamaki, where reporting requirements give us up-to-date numbers of houses that are completed. The Accord target is based on new dwellings consented and sections created across all of Auckland – not completed houses and not just in Special Housing Areas. The reason for reporting on consents and not completed homes is because we get reliable monthly figures from Statistics New Zealand on building consents, whereas the number of completed houses is only available every five years through the census. There is no evidence that the consent numbers over-report building activity, as the two figures have historically aligned.

“The 21-month Housing Accord monitoring report released recently showed 19,921 consented as at June this year – running about 1000 ahead of schedule. The next report covering the full second year of the Accord will be available in coming weeks.

“There are over 2000 building consents issued for the 97 Special Housing Areas established so far in Auckland, out of a long-term capacity of over 45,000. There is a power of work required to convert parcels of land into completed houses through the Special Housing Area process. A structural plan is required on the road and piping set-out, a resource consent is usually required for the earthworks and construction, infrastructure must be built, the building consents issued and the actual houses built.

“The Government is taking further steps to boost housing supply in Auckland. Yesterday, a 9.2-hectare site at Moire Road was gazetted for state housing purposes as the first of the sites set for development under our programme to facilitate housing on Crown-owned land. We are also advancing our planned second phase of Resource Management Act reforms. I expect to announce another tranche of Special Housing Areas in Auckland before the end of the month.”