NZ construction sector sees slight dip in June 2024 quarter

The seasonally adjusted volumes for residential and nonresidential works also decreased.

Nancy Victor September 09 2024

New Zealand's (NZ) construction sector has reported a minor decrease in activity in the June 2024 quarter, with seasonally adjusted building work volumes reaching NZ$8.2bn ($5.06bn), a 0.2% fall from the previous quarter, Statistics NZ (Stats NZ) has revealed.

In the March 2024 quarter, the seasonally adjusted volume of building work was NZ$8.3bn.

Stats NZ construction and property statistics manager Michael Heslop said: “This is the lowest volume of building activity seen in a June quarter since the Covid-impacted June 2020 quarter.”

The seasonally adjusted volume for residential building projects declined by 0.7% to NZ$5.2bn while nonresidential building work experienced a 0.1% drop to $3.0bn.

These adjustments account for typical seasonal patterns and price fluctuations.

Despite these volume adjustments, the actual value of building work completed was NZ$8.8bn for the quarter, not accounting for cost changes or seasonal effects, representing a 2.6% decrease from the same period last year.

Price indices indicate that residential construction prices increased by 1% and nonresidential prices by 0.6% during the quarter. These figures are derived from the capital goods price index.

On an annual basis, there was a negligible 0.1% reduction in the value of building work, totalling NZ$36bn for the year ending June 2024.

Value estimates of building work reflect broader economic trends impacting material and labour expenses in the sector.

Residential building values fell by 4.1% to NZ$23bn whereas nonresidential values saw an increase of 7.8% to NZ$13bn.

Costs have also risen over the past 12 months, with residential construction costs going up by 3.6% and nonresidential costs by 3.7%

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