September Quarter Sees Drop in Non-Residential Building Activity

The seasonally adjusted volume of building activity in New Zealand was $8.6 billion in the September 2023 quarter, down 2.4 percent compared with the June 2023 quarter, according to figures released by Stats NZ today.

The volume of non-residential building work was down 5.9 percent to $2.9 billion and residential building work was also down 0.6 percent to $5.7 billion over the same period.

"The September 2023 quarter marked the first time since the December 2022 quarter that there was a fall in the volume of non-residential building activity," construction and property statistics manager Michael Heslop said.

Seasonally adjusted volume estimates remove the effects of price changes and typical seasonal patterns.

Annual value of building work up 10 percent

The value of building work was $36 billion in the year ended September 2023, up 10 percent from the year ended September 2022.

Value estimate of building work put in place, in contrast to volume estimates, include changes to building costs over time (such as material and labour costs).

In the past 12 months, the capital goods price index recorded a 6.5 percent increase in non-residential construction prices and a 5.6 percent increase in residential construction prices.

Business price indexes: September 2023 has more information on the capital goods price index.

Health buildings lead rise in annual value of non-residential building work

The value of non-residential building work was up 18 percent in the year ended September 2023 compared with the year ended September 2022.

The building types that contributed most to this increase were:

• hospitals, nursing homes, and health buildings, up 45 percent to $1.5 billion
• storage buildings, up 28 percent to $1.9 billion
• offices, administration, and public transport buildings, up 24 percent to $2.0 billion.