Building consents stumble after loan limits
House building consents stumbled in October, down 2.3 per cent, almost reversing the gain seen in September.
House building is storming ahead in Canterbury to record levels, with consents issued there outstripping the Auckland region, where building progress remains slow, Westpac economists said.
Consents issued in Auckland in October were down to their lowest levels since March.
The Reserve Bank brought in new speed limits on low deposit home loans at the start of October, which builders fear will lead to a fall in consents as the controls on lending bite.
But economists say the central bank will be hoping for little fallout on the amount of new building, which is needed to help balance the demand for housing and cool house-price rises.
Consents were issued for 1758 new houses and 133 apartments in October, Statistics New Zealand said.
In seasonally adjusted terms, the number of new houses fell 2.3 per cent, excluding apartments, following a 2.7 per cent rise in September. Including apartments, the number of new dwellings consented in October was down 0.6 per cent.
The apartment segment of the market tends to be volatile. It can push total consent numbers up and down sharply.
For the past 12 months, slightly more than 20,000 consents were issued, the highest levels since late 2008.
The total value of all building work consented in October was $1.182 billion.
Of that, planned residential building work was worth $739 million. Another $443m was for non-residential work in commercial and other kinds of building work.
The increase in consented new houses has slowed in recent months, Statistics New Zealand said.
"The trend for new houses is at its highest level in over five years, but the rate of increase is easing," industry and labour statistics manager Blair Cardno said.
By region, consents in Wellington totalled 169 in October, up by 90 on the same month last year. That included an increase of 61 apartments.
In Canterbury, there were 572 consents in October, up a massive 239 from the same month a year ago.
In Auckland the lift from a year ago was modest, rising just 43, to 476 consents.
Consents in Canterbury are now well ahead of Auckland.
Figures from the Reserve Bank out yesterday showed low deposit borrowing had more than halved in October to $571 million in October, when the new loan limits were introduced.
But lending to people with bigger deposits actually grew to $3.9b.
As a result, overall lending fell just $235m in the month, despite the new controls on higher risk lending.
Given rising net migration and a perceived shortage of homes in Auckland it remains unclear how much impact the loan limits will have on new house building and house prices.
Statistics New Zealand said the trend for new houses is up 65 per cent from the most recent low point in March 2011, but is still 30 per cent below the peak in September 2003.
Canterbury accounted for 30 per cent of the houses and apartments consented in October, with Auckland accounting for 25 per cent.
"The number of consented new dwellings in Canterbury has been ramping up in recent months," Cardno said.