Building activity rises again in June quarter

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The volume of building activity in New Zealand rose 2.0 per cent in the June 21 quarter, compared with the March 2021 quarter, Stats NZ says this week.

“The June quarter showed high levels of building activity volume, and follows a 4.1 per cent increase in the March quarter,” says construction statistics manager Michael Heslop.

Residential building activity drove the increase, rising 4.2 per cent in the June 2021 quarter, while non-residential building activity fell 1.5 per cent.

These are seasonally adjusted volume estimates which show quarter-on-quarter changes in building activity after removing the effects of construction cost changes and typical seasonal patterns.

Volumes are calculated at September 1999 quarter prices.

Between the March 2021 and June 2021 quarters, residential building costs rose by 4.3 per cent, and non-residential building costs by 3.1 per cent (see Business price indexes: June 2021 quarter).

The estimated volume of building work decreased in the March and June 2020 quarters due to Covid-19 alert level changes.

Total building activity then bounced back in the September 2020 quarter, and residential work remains at historically high levels.

Annual residential construction value up 21 percent

The estimated value of residential building activity in the June 2021 year was over $18 billion, up 21 percent from the June 2020 year.

For non-residential buildings in the June 2021 year the value was $8.9 billion, increasing by 3.6 percent from the June 2020 year.

Value estimates are at current prices, so are impacted by changes in residential construction costs, which have increased by 6.9 per cent between the June 2020 and June 2021 quarters. The value estimates include both new builds and renovations.

“Residential construction in the last 12 months has been strong, following historically high levels of new homes consented in recent quarters. The June 2021 year has also seen fewer direct impacts from Covid-19, with no alert-level 4 lockdowns like we saw in the June 2020 year,” says Heslop.

Education construction up, commercial down

The value of building work put in place for education buildings increased by over 18 percent in the year ended June 2021, compared with the year ended June 2020.

The value of building work put in place for commercial buildings decreased by more than 12 per cent over the same period and was the only building type to see a decrease in the June 2021 year.

Commercial buildings include shops, restaurants, offices, and public transport buildings.

Covid-19 and building activity in the June 2021 quarter

Estimates for the June 2020 quarter onwards remain provisional due to COVID-19-related measurement challenges. See Methodology for Value of building work put in place: June 2021 quarter.

The alert-level 4 lockdown starting in August has not had an impact on the June 2021 quarter results. Impacts are expected in the September 2021 quarter.

Any methodological changes in the September 2021 quarter will be outlined before the September 2021 quarter release scheduled for December 6 2021.


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