Record consents = houses not built

by | Jan 18, 2022

A record number of consents for new homes issued in New Zealand last year may not only see delayed construction, but some houses left unbuilt due to a lack of workers and materials, according to a recent RNZ News report.

With 48,522 new homes consented in the year to November 2021, Building Industry Federation Chief Executive Julien Leys says he believes that the industry will just not be able to build all of them.

“It is great on one level to have a record number of consents for new houses, which is what we need, but we have to accept the fact that we do not have enough builders or in fact materials,” Mr Leys said in the report.

Prior to the pandemic and supply disruptions, Mr Leys said New Zealand built only 40,000 homes per year, but now some builders were booked out for the 12 months and beyond because there is a lack of skilled workers – such as carpenters, quantity surveyors and truck drivers – due to border restrictions.

The pandemic has created a “perfect storm” during which builders were also waiting longer to get timber, timber frames, and other materials, Mr Leys said in the report.

“The industry is going through a boom period. The unfortunate fact is that builders are having to turn work away and people that have got some of these consents are either going to have to wait a very long time if they are lucky, or in some cases, the houses just will not get built, unfortunately.”

Although some builders were struggling with cash flow, builders were planning ahead and placing orders for materials much earlier than before. However, Mr Leys believes the government should still allow more skilled workers to come through the borders.

“The challenge we have got in 2022 might well be even more significant than the challenges we had last year, and I think this year 2022 is going to be about shortage and lack of skilled people rather than the shortage of building materials,” he said in the report.

Auckland-based Chancellor Construction Director Wayne Zeng also said in the report that many of the consents are for high-density housing.

“What it means to us is there is more work comparing to a few years ago where builders were building larger homes and now we are building smaller homes.”
That required more resources, skilled workers and materials, he said.

Although the issues were the same as those facing many countries amid the pandemic, Mr Zeng said in the report that there were things the authorities could do to help.

“Local council authorities could consider more substitutions and flexibility around material supplies, and re-engineer and re-look at the current building code to help the builders.”

Builder Richard Merrifield, based in Nelson, agreed the industry was facing challenges and said the authorities should encourage innovation.

“Do we keep building houses the same way we have for years or look at more innovative ideas? There are some bright young people around the industry that will be thinking outside the square, that will come up with solutions to these problems,” Mr Merrifield said.

For now, Building and Construction Minister Poto Williams expects high levels of residential construction will continue for some time and the government would continue to work with the sector to help minimise disruption from the pandemic.