Latest / Early Edition with Ryan Bridge / Tommy Honey: Construction Industry Council ED on the drop in building consents

Transcript

Tommy Honey: Construction Industry Council ED on the drop in building consents · Early Edition with Ryan Bridge

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  Speaker 1: The number of new build consents issued in the year
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  Speaker 1: to Joune has dropped to a five year low. Stats
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  Speaker 1: and Z data shows just over fourteen thousand standalone houses
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  Speaker 1: we're consented, that's down nineteen percent, and there was an
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  Speaker 1: even larger drop in multi unit buildings, with just over
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  Speaker 1: eighteen thousand approved that's down twenty eight percent. Joining me
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  Speaker 1: in our Construction Industry Council Chief executive sorry executive director,
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  Speaker 1: Tommy Honey, Hey, Tommy Marina, how are you?
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  Speaker 2: Yeah?
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  Speaker 1: Good, thank you, Good to have you on the show.
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  Speaker 1: I just wanted to point out the apartments consents down
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  Speaker 1: fifty percent. Yep, yep, that's big.
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  Speaker 2: So oh it is. And so what we've seen is
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  Speaker 2: a continuation of sort of a downward trend that really
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  Speaker 2: started in the middle of it's about June twenty twenty two,
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  Speaker 2: so two years ago. And we have been like a
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  Speaker 2: lot of people waiting for that kind of to reverse
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  Speaker 2: or at least plant oh, but it seems like we're
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  Speaker 2: still heading downwards. The thing about apartments is that for
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  Speaker 2: the for the builders, developers, investors and those is that
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  Speaker 2: they're quite a risk. And when you've got inflation running
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  Speaker 2: as high as it has been and that's starting to
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  Speaker 2: turn the corner, but the Reserve Bank is not. Actually
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  Speaker 2: they haven't turned the corner yet, and there's a bit
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  Speaker 2: of a lag there was, or there's always a lag
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  Speaker 2: when when the mortgage rates and interest rates so very
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  Speaker 2: slow to respond. So I still think we're three six
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  Speaker 2: nine months away from any really great health. Coming back
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  Speaker 2: to the bottom sector.
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  Speaker 1: Who is building? I mean, obviously some houses are getting built.
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  Speaker 1: Who is building them?
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  Speaker 2: Well, I think I think the people who've got the
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  Speaker 2: winders all to do that, because you've got to think
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  Speaker 2: all so the whole real estate state market of flat
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  Speaker 2: So you're going to go building that. Yeah, if you've
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  Speaker 2: got a house you live in and you want to
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  Speaker 2: build a new one, sell the first one. Yeah, not
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  Speaker 2: a guarantee that that's going to This is the right
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  Speaker 2: time to be doing that, unless you're just looking a
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  Speaker 2: little bit further into the future. One of the sort
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  Speaker 2: of handbrakes on the whole system is that one of
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  Speaker 2: our biggest builders or the biggest clients really has recently
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  Speaker 2: in recent year has been the government through coying or order.
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  Speaker 2: And because they put a pause on that, everyone that
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  Speaker 2: works for them, which is builders, and because the government
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  Speaker 2: itself is a builder. They have developers who have trades,
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  Speaker 2: people in sub trades, and that whole part of the
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  Speaker 2: sect has taken a real hit because the number of
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  Speaker 2: houses that kyng Aura has been consenting getting built in
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  Speaker 2: recent years has been around about ten to fifteen percent
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  Speaker 2: of all the houses. So the other that nineteen percent drop,
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  Speaker 2: a good portion of that is actually due to coying
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  Speaker 2: or and not building starting any new projects. They're finishing
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  Speaker 2: off a few projects, but they put a pause and
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  Speaker 2: a whole.
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  Speaker 1: Lot and that a perfect storm.
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  Speaker 2: Oh yeah, it happens. Confidence right through all the way.
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  Speaker 2: And this whole a whole set depends on confidence and certainty,
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  Speaker 2: and there's so much uncertainty around with what the government's doing.
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  Speaker 2: When they've got plans, we wanted to see them happen
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  Speaker 2: a lot quicker the economy, who are interest rates and
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  Speaker 2: then everyone who wants to spend the money sitting back
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  Speaker 2: and saying, oh, we'll just wait, so we're Yeah, perfect
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  Speaker 2: storms are the right way to describe it.
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  Speaker 1: Tommy, thanks so much for your time. That's Tommy Honey.
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  Speaker 1: He's the executive director at the Construction Industry Council.
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