New Zealand residential building consents rose in October, snapping two months of decline on a pickup in Auckland, where approvals for apartments helped drive the trend for new dwellings in the city to the highest level in almost 11 years.
Seasonally adjusted consents rose 5.1 per cent to 2,339 in October, following declines of more than 5 per cent in both September and August, Statistics New Zealand said.
Consents soared about 20 per cent in June. Actual consents rose 8.1 per cent to 2,349 in the 12 months ended Oct. 31. Consents for apartments more than doubled from September to 244, while consents for houses fell 2.8 per cent to 1,732.
In Auckland, where increased migration has led to a shortage of housing, dwelling consents jumped 36 per cent in October from the same month last year to 805, although on a trend basis they were unchanged from September.
In the Waikato, one of the ‘spillover’ regions benefiting from Auckland’s overheated market, consents jumped 34 per cent to 259, while for the Bay of Plenty consents soared 71 per cent to 205. Canterbury recorded the biggest decline, down 29 per cent to 489, suggesting earthquake-related demand may be abating.
“An apartment-induced lift in October residential building consents masks relatively muted underlying demand,” said Jane Turner, senior economist at ASB Bank.
Economists are awaiting this month’s building consent data for any early signs of reaction to Reserve Bank measures to quell the risk from a housing bubble.
The central bank introduced Auckland-specific lending restrictions this month, while the government’s more stringent enforcement of taxing speculators’ capital gains began last month.
The actual value of building work consented in October was $1.4 billion, reflecting a 2.4 per cent gain from a year earlier in residential work to $898 million and a 4.9 per cent increase in non-residential work to $479 million.