New economic figures show Tauranga consumers have been spending up large in the last year as the city's economy and population continues to boom. Bay of Plenty Times reporter Caroline Fleming breaks down the highlights, trends and economic indicators in the latest Infometrics quarterly economic report commissioned by Priority One, and talks to the experts about what it all means: including what we're spending our money on and why.
Tauranga residents can't hide their shopping bags anymore, as a new report shows a whopping $528 million was spent by local consumers in the 12 months to March.
The latest Infometrics quarterly economic report commissioned by Priority One highlighted a 5.6 per cent rise in consumer spending - an additional $30m on last year.
Caroline Beattie from analytics company Marketview said with more foot traffic in the city, transactions were up 7.8 percent for March 2019 quarter compared to 2018.
People spent more on hospitality in general (up 6.8 per cent) and on takeaway food in particular (up 11.1 per cent).
Alan Sciascia from Hospitality New Zealand said new establishments opening in Tauranga recently would have helped drive the spending boost.
He said the city's hospitality sector was "vibrant" at the moment as the economy boomed and the population continued to grow.
Priority One projects manager Annie Hill said higher consumer spending often indicated households were more confident in their employment and financial positions.
That confidence was also reflected in the record low unemployment rate of 3.8 per cent and the strong job growth in Tauranga over the last few years - the highest in the country.
This was as a result of existing businesses expanding and new businesses moving here due to the competitive advantages the area provides.
But it was not just locals opening their wallets. Tourism spending was up 4.3 percent.
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Mount Hot Pools manager Matthew Strange said the business had seen a decent increase in non-residents visiting the pool in the first quarter this year.
Around 300,000 people visited the Bay Venues-owned pools last year, of which 44 per cent were non-residents. That number was up 5 per cent so far this year, with 49 per cent of visitors being non-residents, he said.
Strange put the increase down to the low rainfall and high temperatures over the summer period, along with a strong cruise ship season.
The report also showed that residential building consents took a hit last quarter, decreasing by 12.4 per cent compared with the same quarter last year.
The decrease was not aided by non-residential consent values as these were down by 0.4 per cent.
Hill said although the construction sector had seen a slight downturn this quarter, the fluctuation was not of concern.
"The construction industry has been working at maximum capacity for the last four years and is, to some degree, constrained by the availability of land, resources and tradespeople available to undertake developments."
She said the short to medium term prospects for the sector remained good.
Registered Master Builders Association Tauranga president Todd Grey had a similar stance and said although consents numbers had dropped, values were still high.
From his perspective, there was high demand for builds and the slowing could be down to larger projects causing consents to take longer to process.
He said the drop in non-residential figures could be down to timing as large projects such as the Tauranga Crossing and the Bayfair extension had just finished up and were in a "transition" period.
The brief slowdown could be good, he said, as it would give workers in the sector a chance to "catch their breath" after a busy few years.
Tauranga Chamber of Commerce chief executive Matt Cowley said the talk of the capital gains tax would have affected the volume of consent applications, albeit temporarily.
Population growth was highlighted as a driving force for Tauranga's overall economic growth, which was up 3.6 per cent on last year.
Highlights for Tauranga:
- Traffic flow up 5.9 per cent
- House prices up 5.4 per cent
- House sales up 0.2 per cent with 2950 sales
- Average house value $719,437
- Commercial car registrations up 4.7 per cent
- Private car registrations down 3.3 per cent
- Enrolments with primary health organisation) increased by 2.9 per cent
- People on working-age jobseeker support increased by 10.3 per cent
- Guest nights in Tauranga decreased by 2.4 per cent