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Housing crisis drives New Zealand building boom

Xinhua, April 30, 2015 Adjust font size:

New Zealand's housing crisis is driving the biggest boom in home building since the global financial crisis, figures from the government statistics agency indicated Thursday.

The number of new dwellings consented last month was 14 percent higher than March 2014, and the highest number of new homes consented since 2006, according to Statistics New Zealand.

"Townhouses, units, and retirement villages have driven the increase in new dwelling consents over the past year," business indicators manager Neil Kelly said.

A total of 2,271 new dwellings were consented last month, more than half of them in the biggest city of Auckland and earthquake- battered Christchurch.

The value of approved homes rose by 16 percent to 925 million NZ dollars (704.44 million U.S. dollars), while the value of non- residential work was up just 0.7 percent to 427 million NZ dollars (325.18 million U.S. dollars).

"It is significant that we have now topped 25,000 new building consents per year nationally, the strongest house build rate in nine years. The latest annual figure of 25,038 compares to the low of 13,236 following the global financial crisis," Building and Housing Minister Nick Smith said in a statement.

"This is good progress, but with strong net migration data from fewer New Zealanders leaving, we need to keep doing more," he said.

Earlier Thursday, the Reserve Bank of New Zealand (RBNZ) held its official interest rate at 3.5 percent, despite inflation coming in well below its 1-percent to 3-percent target range.

RBNZ governor Graeme Wheeler cited "elevated" house price inflation in Auckland and the overvalued New Zealand dollar as concerns.

The government's failure to rein in soaring Auckland house prices had prevented the RBNZ cutting interest rates to stimulate growth, opposition lawmakers said.

"Inflation is below the target band and the economy has actually deflated in the past two quarters, yet we have among the highest interest rates in the developed world," Grant Robertson, finance spokesperson of the main opposition Labor Party, said in a statement. Endi