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Source: MIL-OSI Submissions

Non-residential building volume slows again – Media release

6 March 2020

The volume of construction work on shops, health buildings, factories, and other non-residential buildings fell in the December 2019 quarter compared with the September quarter, following recent volatility, Stats NZ said today.

After accounting for typical seasonal patterns and higher construction costs, non-residential building activity volume fell 3.6 percent in the December 2019 quarter. This followed a 2.7 percent rise in the September quarter, and a 4.6 percent fall in the June quarter.

 “Non-residential building activity can flip-flop from quarter to quarter, partly reflecting large commercial projects starting, ending, and some pausing during construction,” construction indicators manager Melissa McKenzie said.

Overall building volume fell 0.8 percent in the December 2019 quarter, with residential growth (up 1.2 percent) partly off-setting the fall in non-residential work.

The volume of building work remains at historically high levels and has been generally increasing since 2012. Activity was originally boosted by the Canterbury earthquake rebuild, and more recently by developments in Auckland.

Residential building value exceeds $4 billion

“Overall building activity was running at high levels during 2019, with over $4 billion of residential work in each of the latest two quarters. On top of this, there was nearly $2.4 billion of commercial building work in the December 2019 quarter,” Ms McKenzie said.

Residential building value rose 7.3 percent in the December 2019 quarter, and non-residential rose 8.9 percent, compared with the same quarter a year ago.

Some of the building value increase is due to price inflation in the construction sector, with a 3.0 percent rise in residential building prices in the December 2019 year, and non-residential building prices up 5.4 percent over the same period.