Home renovations spur lift in building industry

October 29th, 2013

stuffBRIDGET JONES
Last updated 05:00 16/01/2011

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Building experts hope reports of a bumper summer will re-energise the sagging industry.

Website builderscrack.co.nz has had its strongest ever start to a year, with the number of people embarking on home renovations up by more than 50% for the same period in 2010.

Director Jeremy Wyn-Harris says it is shaping up to be a strong year for the building industry. “This has been a much better summer for tradespeople around the country than last year.”

Registered Master Builders chief executive Warwick Quinn says it comes at a time when the industry needs some good news.

“In the last couple of years we’ve seen the additions and alterations market held up quite well and it’s the new homes that have taken a hammering.

“We’re in a pretty low ebb. We’re at one of the lowest levels of activity we’ve seen in decades. It’s looking pretty bleak.”

But he agrees the signs are pointing to an increase in activity.

“The feedback from the smaller regions is similar, so that’s really encouraging. Whether it translates into new homes and building consents is another story.”

He says any growth in the renovation market points to homeowners thinking long term, making a commitment to stay and up-grade current homes rather than building, or buying, new ones.

“What tends to happen, when times are bad, [is] homeowners may not build a new home but they’ll do other work instead.”

BNZ chief economist Tony Alexander is not expecting much movement in the housing market until later in the year and that lack of movement is pushing people to consider making the most of what they already have.

“People seem very determined to get their debt levels down and that manifests itself in retail spending growth being really weak, so the indicators we have for the housing market are on the flat side.

“There could be some long-term thoughts that are creeping into people’s minds where they think, it’s not too bad where we are, we’re going to stay here and the housing market maybe isn’t going anywhere for a long time, therefore we are going to be here for another 10 or 15 years so let’s do it up, maybe take on a little bit more debt and the money we would have lost by paying a real estate agent to shift, maybe we can spend that successfully to do up the house.”

Wyn-Harris agrees, as the jobs being posted on his website, which matches tradespeople with homeowners, are not just small touch-ups.

“We are getting some good jobs like re-roofing and some big painting jobs. And to paint the exterior of a house can be $15,000 and up.

“Kitchen renovations are always popular and they can be expensive and can range from anywhere between $5000 and $30,000.”

He says homeowners are starting to take risks again after economic challenges.

“We’ve had quite a lot of old jobs that had been on hold that have been carried on with in the past few weeks, so people are actually following through – it’s their new year’s resolution. A lot of it is cutting it quite fine about whether they can afford to finish these jobs, but if they are feeling positive about the economy, they are more likely to take a risk.”

According the website, the strongest growth areas were Wellington, Taupo, Rotorua, Tauranga and Christchurch, where Earthquake Commission jobs have started to filter through.

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