Building sector slumps to decade low

The latest good news from the “improving NZ economy”

Stuff

8 September, 2011

The building sector is in the worst slump in a decade, with a big dive in the number of homes being built to an 18-year low.

Statistics NZ figures show the amount of building work fell 6.6 per cent in the June 2011 quarter, after adjusting for price and seasonal effects. Activity was down to the lowest level in 10 years.

Home building activity fell 12 per cent in the June quarter. It has now fallen 24 per cent in the latest year, to the lowest level in 18 years.

This comes after the number of new homes approved also hit a record low earlier this year.

"A decline of this extent is surprising," said Jane Turner, economist at ASB. "Construction activity was already very weak, and we had expected construction activity to remain broadly stable given building consents had started to stabilise over the first half of 2011."

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