Biggest house builder G.J. Gardner: market ‘shrank’ 30%, negativity a concern

G.J. Gardner managing director Ellie Porteous is concerned about negative sentiment in the sector. Photo / Supplied

New Zealand’s biggest house builder G.J. Gardner built fewer homes in the latest year.

But a chief says many problems which delayed construction previously have now been resolved and she is encouraging people to have confidence in the sector.

Ellie Porteous, joint managing director of nationally franchised G.J. Gardner Homes with husband Grant Porteous, said the business had built fewer homes nationally in the year to March, with numbers down 30 per cent annually.

But the shareholder in Deacon Homes, which is the builder’s master franchisor, wants to encourage people considering building to view the sector positively and take heart that their hopes for a new home could be fulfilled.

Data from BCI in the year to March 31 showed G.J. Gardner franchises built 1166 new residences, down 30 per cent on the previous year’s 1687 residences, in the year to March 31, 2022, she said.

“The market has shrunk. We’re hearing that from our competitors, due to the economy. Around an election year, people tend to sit and wait a bit too,” she said.

She understands why some people are worried about building a new house.

“Sadly our industry is justly maligned at times for customers being let down by builders for a range of reasons,” she said of many liquidations of builders reported lately.

In 2021, G.J. Gardner started construction of its 20,000th home since it began here nearly a quarter of a century ago. The business was established here in 1997 but Grant Porteous said it never intended to be as dominant as it has become.

Last month, the Herald reported the voluntary liquidation of Scarbro, building dozens of new apartments but now owing $14.9 million to around 300 creditors.

Official data out this month showed consents from councils around New Zealand for new residential buildings plunged 21 per cent in this latest quarter compared to the same time a year ago.

Stats NZ said last week that 9719 new homes were consented in the three months to the end of March, compared with 12,333 at the same time last year.

And summer’s bad weather might take a further toll.

Grant and Ellie Porteous of G.J. Gardner Homes. Photo / supplied

“We only identified a few alterations that mentioned flooding or cyclone repair work in this month’s data, however, some repairs may not include this information on the consent application. Some emergency repairs do not require a building consent and will therefore not be included in future building consent issued data,” it said on May 4.

There were 46,924 new residential consents granted in the year to March 2023, down 7.9 per cent annually. Of those, 19,668 were stand-alone houses, down 23 per cent compared with the year ended March 2022.

As interest rates rise, inflation spirals and lending criteria tighten, the market for new housing has turned and the latest data is reflecting that. More flats, units and townhouses are being built: 27,256 multi-unit homes were consented, up 6.6 per cent over the same period, Stats NZ found.

Celebrations in 2021 at the 20,000th home by G.J. Gardner in New Zealand. Photo / supplied

Porteous said plasterboard wasn’t the only building material in short supply previously but those problems now seemed to be resolved and builders had fewer problems getting supplies on time.

“There is so much negative narrative around housing and the industry. It is potentially and unnecessarily putting people off,” she said, although she also acknowledged why people were less certain, particularly with high interest rates.

CoreLogic NZ chief property economist Kelvin Davidson said the current market conditions were having an effect on all groups of buyers considering purchasing a house. He wasn’t referring just to new homes but to existing homes mainly.

Porteous said the real irony is that now is a great time to build due to more builders and tradespeople being available as the market drops.

“Supply issues are now gone, so no delays should be encountered,” she said of goods deliveries.

Banks wanting new mortgage customers can sometimes be more flexible in negotiations also, she said.

Many councils and engineers had cleared big work backlogs, so could handle consent applications faster, she said.

Grant Porteous expressed concern about people choosing builders based on unsubstantiated claims.

“The most important key to enjoying and having a safe building experience is choosing the right builder. I’d implore people to look past fluffy brochures, and grandiose names of companies to give false status and false claims on pretty websites. Find a builder’s true worth: their proven performance history. We truly do hate seeing people hurt by unworthy builders,” Grant Porteous said.

Other data shows a big rise in new apartments being built. For example, the RLB Crane Index out last month showed new cranes up at apartment sites in Epsom, Grey Lynn, Hobsonville, Mt Eden, New Lynn, Northcote, Onehunga, Ōrakei, Parnell, Point England, Ponsonby, Remuera and Takapuna.

The number of long-term fixed high-rise and crawler cranes working on New Zealand construction sites rose 6 per cent to hit a record high of 157 of the towering giants up nationally.

New Zealand had 144 cranes up by late 2021, which rose to a record 150 cranes in the six months to the end of February, last year.

That dropped to 148 cranes in the six months to last August but by the quarter to March, had shot to a record 157 cranes nationally. Those cranes are working on all types of construction including infrastructure, commercial, industrial, retail, education, tourism and residential sites.