Page 17 - HW April 2022

Statswatch – Feb 2022
THE BUILDING BOOM continues unabated after third quarter lockdowns.
• February’sriskdatasuggestsstrainoncommercial
construction
• Itwasbacktoworkafterlockdownswithbiggrowthinthe
Dec quarter value of building work put in place
• February’s consents also rebound after soft January.
FEBRUARY 2022 RISK DATA
Our regular data series from CreditWorks Data Solutions (www. creditworks.co.nz) assesses the level of credit risk posed by the four business sectors most closely associated with our chosen industry:
• Hardware,Building&GardenSuppliesRetailing • CoreRetailing
• ResidentialConstruction
• CommercialConstruction.
While our last update, reporting on January 2022 (see the
last issue), showed a noticeable risk increase across all four sectors and raised the expectation of further deterioration, February2022’sdatashowrelativelynegligiblemonth-by-month movementinthehigherriskbands,withanyadversemovement focused in the lower risk bands.
Indeed, says CreditWorks’ Alan Johnston: “Considerably more debt sits at present under the Current, and Current + 1, payment profiles, compared to this time last year – which is a good thing.
“This is probably a reflection of supply constraints in the market and the need / desire to keep suppliers happy, so where possible, the supply lines remain open.”
However, he adds: “We are still seeing strain in the Commercial Construction sector where currently the level of risk in the higher risk bands (20-80%) has increased threefold
since February last year, from 0.5% to 1.4%.
“While still at manageable levels the trend in this area does
warrant concern and is worth monitoring over the coming months.”
DECEMBER QUARTER BUILDING WORK
While the June 2021 quarter’s Value of Building Work put in Place from Stats NZ (www.stats.govt.nz) showed big gains, the September 2021 quarter recorded more modest growth, thanks to Auckland’s lockdown.
The December quarter however showed a return to work with the total actual value of building work put in place a little over $8 billion (+17% on the Dec 2020 quarter).
Residential building work was +19% at $5.6 billion, and non- residential +12.7% at $2.5 billion after negative growth in the previous quarter.
The non-residential building types with the most work put in place (by value) in the December 2021 quarter were:
• Education: $420 million (+27%)
• Factories & industrial: $373 million (+68%)
• Storage:$345million(+15%)
• Offices,admin&publictransport:$292million(–1.9%).
By region, the biggest growth in the actual values of total building work in the December 2021 quarter were: rest of the North Island (+36%); Wellington (+25%); Canterbury (+17%); and Waikato (+11%); and rest of the South Island (+11%).
Auckland, the region most affected by lockdowns in the previous quarter, was just +11% by value.
FEBRUARY 2022 BUILDING CONSENTS
A record tally of consents for the February 2022 month from Stats NZ (www.stats.govt.nz) came after January’s residential consent value was just +4.5% and non-residential negative (–7.3%).
stats watch
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