NZ Herald
  • Home
  • Latest news
  • Herald NOW
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Herald NOW
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Politics
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Herald NOW
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / Business / Companies / Construction

Residential building drop predicted: 'We are in volatile times'

RNZ
21 Dec, 2020 11:20 PM4 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

Photo / RNZ

Photo / RNZ

By RNZ

A new report forecasts a crash in the numbers of houses to be built over the next three years, but builders say they are busier than usual.

It predicts the numbers will fall substantially as banks tighten lending.

The value of residential building is tipped to hit just $13.4 billion in 2023 - about 43 per cent down from last year.

Advertisement
Advertise with NZME.
Advertisement
Advertise with NZME.

The National Construction Pipeline Report 2020 was commissioned by the Ministry of Business, Innovation and Employment (MBIE).

It forecasts a decrease in new dwelling consents of more than 37,000 in 2019, to an average of 26,800 per year for the next six years.

Residential building makes up the bulk of construction activity and is typically the hardest hit by changing economic conditions.

Construction Industry Council chair Graham Burke told Morning Report the forecast was counter-intuitive because people on the ground were saying they have never been this busy.

Advertisement
Advertise with NZME.

"Builders are saying they are booked up for all of next year and some into the following year."

He said for building to come to a halt would take something significant happening.

"There's plenty the Government can do to make sure that consumer confidence remains. The Government are building more houses themselves than we've seen in decades; that's a small part of the industry, we do need private houses to continue."

Burke said there was a shortage of materials from overseas, which are expected to get tighter over the next quarter.

"There's certainly nothing to suggest the kind of drops that are being forecast in this report.

"Any business has to be prudent and we are in volatile times."

He said there were a record number of apprentices but they are "barely enough to cover the retiring baby boomers".

The Government needed to do more to stimulate the private market, he said as the industry waits for an announcement regarding more rentals and first homes in early 2020.

"We wouldn't want to see a major tightening of monetary policy because that could have an adverse effect."

Burke said the Labour Government needed to look at how Australia maintained consumer confidence following the global financial crisis in 2008.

Advertisement
Advertise with NZME.

"Anything to improve the supply of land quickly would be a very good step. We know there is a real shortage of sections, especially in Auckland, and sections ready to go to market, so getting that infrastructure in place would be a major help.

"The supply and cost of land is probably the biggest problem holding the prices up."

Burke said for those looking at building their house: "Find a good builder and book them in soon."

The report finds that despite the forecast, demand for residential housing remains strong.

"There is steady pipeline of demand and latest data show new home consents are currently at a 46-year high," MBIE Building System Performance general manager John Sneyd said.

"Infrastructure construction is expected to increase, particularly in Auckland and Waikato/Bay of Plenty. Infrastructure is the only construction area forecasted to see sustained growth, reaching $10.1b in 2025- up 6.3 percent on 2019."

Advertisement
Advertise with NZME.

The report forecasts:

- Compared to 2019, Auckland is expected to see a reduction in total construction activity of 16 per cent to $14.3b by the end of 2025. Waikato/Bay of Plenty is forecast to decrease by 18 per cent to $5.5b, Wellington by 35 per cent to $2b, Canterbury by 57 per cent to $3b, Otago by 33 per cent to $1.8b and Rest of New Zealand by 29 per cent to $4.7b.

- Non-residential construction activity (including hotels, offices, retail outlets and industrial buildings) is forecasted to drop 42 per cent nationally from $10b in 2019 to $5.8b in 2022 before recovering to $7.4b in 2025.

- Multi-unit dwellings accounted for 41 per cent of all dwellings consented in 2019. Multi-unit dwellings are anticipated to be hardest hit by the Covid-19 pandemic, particularly apartments, and these are forecast to account for 32 per cent of all dwellings consented in 2022.

Save

    Share this article

Latest from Construction

Construction

'A substantial breach': Builder's work under scrutiny after installing leaky gazebo

04 Jul 04:00 AM
Premium
Business|economy

18,800 people booked for NZICC; anaesthetists, ophthalmologists the latest

03 Jul 10:39 PM
Property

'Special ceiling': sun and moon art adorn new Auckland train station

03 Jul 03:00 AM

There’s more to Hawai‘i than beaches and buffets – here’s how to see it differently

sponsored
Advertisement
Advertise with NZME.

Latest from Construction

'A substantial breach': Builder's work under scrutiny after installing leaky gazebo

'A substantial breach': Builder's work under scrutiny after installing leaky gazebo

04 Jul 04:00 AM

The builder argued there were defects with the gazebo design but the tribunal disagreed.

Premium
18,800 people booked for NZICC; anaesthetists, ophthalmologists the latest

18,800 people booked for NZICC; anaesthetists, ophthalmologists the latest

03 Jul 10:39 PM
'Special ceiling': sun and moon art adorn new Auckland train station

'Special ceiling': sun and moon art adorn new Auckland train station

03 Jul 03:00 AM
Premium
$66m repair bill for Auckland apartments sparks court action

$66m repair bill for Auckland apartments sparks court action

02 Jul 11:28 PM
From early mornings to easy living
sponsored

From early mornings to easy living

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP