KEY POINTS:
Residential construction remained in a funk last month with the number of consents issued for new houses just crawling up from June's more than seven-year low.
Figures published by Statistics New Zealand (SNZ) today show 1410 new housing units were authorised in July, the second-lowest monthly total since February 2001. In June 1362 were issued.
The residential building consents issued last month were valued at $491 million, down $188 million from July 2007.
In the past four years, there had been only five months with a monthly value below $500m, SNZ said.
Non-residential building consents in July were valued at $349m, down $4m on a year ago.
The trend for the number of new housing units had fallen 35 per cent since June 2007, with the trend for the total value of residential building consents, which peaked at the same time as the number of consents, also continuing to decline.
For the year ended July, the number of residential building consents was down 15 per cent from a year earlier, or down 14 per cent with apartments excluded.
The value of the residential consents for the year was down 9.1 per cent to $7.09 billion.
"The obvious up-shot is that there is considerable downside for residential investment over the rest of this year," said UBS NZ senior economist Robin Clements.
On the positive side though, said Clements, the "bounce-back" in house sales over June and July suggested that a "base may be forming".
The accelerated trend decline in consents meant that this trend had now reflected the plunge in house sales - i.e. - it should "soon show some signs of bottoming".
"The bottom-line is that residential building activity is likely to be a drag on real GDP growth for the rest of this year and possibly into early next year," said Clements.
The trends represented a "downside risk" to economic growth forecasts, which were expecting real GDP growth to be seen again after recession in the first half of this year.
Non-residential buildings authorised last month were valued at $349m, down 1.2 per cent from July 2007.
For the year, the value of non-residential consents rose 5.3 per cent to $4.32b.
For all buildings, the value of consents was down 19 per cent to $839m in July and down 4.2 per cent to $11.41b for the year.
The Auckland and Canterbury regions had their lowest number of new dwelling consents for the past year at 237 and 217, respectively.
It was the third lowest month for Waikato with 199, but the second highest for Wellington with 220.
- NZPA
