Canterbury home building highest in NZ

Wednesday, 1 November 2023

Canterbury is still leading the way in building new housing, despite construction having dipped across the country.

For the past two years, Canterbury councils have approved more new homes in proportion to the population than any other region, according to Stats NZ.

Real estate agents are reporting that homes in Canterbury, in particular greater Christchurch, remain popular with buyers around the country, partly because the market is more affordable than both Wellington and Auckland.

In the year to the end of September, Canterbury consented 7209 new homes, equating to 10.8 per 1000 residents. This was an annual drop of 17%, a smaller decrease than in the other main centres.

Canterbury’s consenting rate compares with 9.8 per thousand residents in Auckland, 7.8 in Otago, and 5.7 in Wellington.

In the greater Christchurch area, Selwyn District Council consented 1452 new homes in the past year, Waimakariri district 753 and Christchurch city 4232.

Home building in Christchurch peaked last year, but still remains as high as at the peak of the earthquake rebuild in 2014.

Michael Heslop, Stats NZ’s construction and property statistics manager, said while numbers of housing consents had dropped nationally, numbers were “still at a higher level than any 12-month period prior to 2021”.

Just over 40,000 homes were consented nationwide in the past year, down from 51,000 the previous year.

Property analyst CoreLogic reported on Tuesday the average value of homes in Christchurch is $741,178. This is 1.5% higher than three months ago, but 1.8% less than the same time last year.

The value compares with averages of $908,000 nationally, $1.26 million in Auckland, just over $1m in Tauranga, $797,000 in Hamilton. $893,000 in Wellington, and $615,000 in Dunedin.

CoreLogic’s chief property economist, Kelvin Davidson, said the key fundamentals for house prices across the country “have been looking stronger for a reasonable period of time now”.

Davidson said the change of government seemed to have bolstered confidence in the housing market.

“We’ve also seen net migration rise to a new record high, which is boosting property demand.”

He said the supply of homes coming up for sale was low, and the resulting competition among buyers was keeping prices up.

Listings website realestate.co.nz said on Monday the average asking price in Canterbury during October was $714,000, and listings were down 5.2% from a year ago.

The consenting data shows that with medium-density housing development increasing across Christchurch city, the numbers of new attached homes approved has outnumbered free-standing houses since 2021.

In the past year, two-thirds of the new homes consented for Christchurch city were apartments, town houses or other types of attached housing.

The average construction cost in the past year was $537,000 for houses, and $296,000 for attached homes.

According to the Canterbury Construction Report compiled by consultant Mike Blackburn, the biggest developer of homes in Christchurch in the past year was Williams Corporation, which had more than 250 town houses consented.

Blackburn said in his report units are increasingly attracting home buyers because of their price, especially with interest rates higher. They are also attracting investors, he said.

Other developers in the city with high consent numbers were Mike Greer Homes and Fletcher Residential.

Williams Corporation is advertising to buy development sites of at least 600m² inside the four avenues, and at least 1400m² within 7km of the city centre.