High demand leads to long waits for new homes in Manawatu/Whanganui

Japac Homes co-owner Paul Haydock says people are snapping up houses in Palmerston North, often before they are built.
MURRAY WILSON/STUFF

Japac Homes co-owner Paul Haydock says people are snapping up houses in Palmerston North, often before they are built.

Builders are in such high demand that it can take more than a year to get plans rolling for a new house, a Palmerston North builder says.  

Figures provided by the Palmerston North City Council show building consents issued for new houses in Manawatu/Whanganui have shot up 38.9 per cent, with 917 granted  in the 12 months to June. That's almost nine times faster than the national growth in new home consents.

Japac Homes co-owner Paul Haydock​ said last year was a "crazy period" for real estate in the region and it was even busier this year.

Building consents for new homes in Manawatu/Whanganui have shot up 38.9 per cent, with 917 granted over the 12 months up ...
DAVID UNWIN/STUFF

Building consents for new homes in Manawatu/Whanganui have shot up 38.9 per cent, with 917 granted over the 12 months up to June. That's almost nine times faster than the national growth in new home consents.

"I think it's the first time Palmy's seen a waiting list just to get in and talk about building a new house."

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It could take up to 18 months to have a first consultation with architects and builders, Haydock said.

His company was having to ask clients to come back again later, because they were booked up for more than a year.

The market slowed between January and March, but then it took off again, he said.

A sizeable chunk of the demand was coming from out-of-towners moving into the region.

"Infill houses, and other spec-work houses, get snapped up quick before they're even hitting the market. [Often] we can't even get them finished before they're sold." 

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Last year, there were a lot of Aucklanders moving to Palmerston North. This year, they were largely coming from Wellington, Haydock said.

"They say they're coming here for the lifestyle. The houses are cheaper, the traffic isn't as bad and people really like the schools here."

Avenue Construction owner Phil Round said this year had been "extremely busy".

He was building more homes than usual and had taken on another apprentice to keep up with demand, he said. 

Architectural designers were also busy and Round expected this to  affect builders as well.

Council economic policy adviser Peter Crawford said a solid economy and relatively cheap property prices were pulling in people from Auckland, Wellington, the Bay of Plenty and Hamilton.

"The growth in construction is creating jobs, which is attracting more people, along with the improvement in the beef, sheep and dairy industries.

"It has been unusual to see all of those industries strong at the same time."

But most of the new arrivals were coming from overseas, he said.

Manawatu had a net gain of 1253  migrants move into the region in the 12 months up to June, a 19 per cent annual increase. Overall, New Zealand immigration only increased 5 per cent in the same period.

Crawford expected the introduction of the council's new online consents process would drive a further increase in building consents issued  in the coming year.

The new system was put in place at the end of June.

"There was certainly a surge in consent applications in the week after that was introduced.

"But we're waiting on the final figures... to see what impact it has over the next three months."

 - Stuff

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