20 February 2017
Population Growth vs Number of Houses Being Built
In our January 2016 Blog, we looked at these stats. I have now updated them for the last year.
Hamilton
From this information, Hamilton is building more houses than it requires by around 350 houses or to accommodate 924 people. This could be catching up a shortage. I would, therefore, be cautious buying in Hamilton and make sure the figures really work. It will be interesting to watch rental statistics over the next year to see if there are excess rentals!
Need 830 new houses per year Vs Building 1,179
Waikato
From this information, Waikato is building pretty much the perfect number of houses.
Need 3,585 new houses per year Vs Building 3,552
Tauranga
From this information, Tauranga is building more houses than it requires by around 950 houses. I would, therefore, be very cautious buying in Tauranga and make sure the figures really work. It will be interesting to watch rental statistics over the next year to see if there are excess rentals!
Need 732 new houses per year Vs Building 1,695
BOP new dwellings, 2,520 from January 2016 to December 2016. November 2014 to October 2015 was 1,734, so 786 more than around a year before.
Auckland
From this information, Auckland is not building enough houses to keep up with demand, and is approximately 4,000 houses short in one year! This is similar to the stats a year ago, and Auckland seems to be getting further and further behind.
Need 13,953 new houses per year Vs Building 9,930
When you look at this information overall, it is concerning that Hamilton, Waikato, and Tauranga seem to be building considerably more houses than required. This could create a large over supply and a possible 'bust'.
It appears that a lot of the lift in property prices in Hamilton, Waikato, and Tauranga is due to greed and the ripple effect, rather than being based on the true fundamentals of supply and demand.
Auckland, on the other hand, has a well-documented shortage, and over the last year the housing shortage has gotten worse by 4,000 houses. If immigration stays high and the Auckland population continues to grow, then I still cannot see Auckland house prices crashing. While there might be a flat period or blip, economics suggest that Auckland house prices will continue to rise.
Kind regards
Ross Barnett
I also had a quick look at Napier, Palmerston North, Wellington, Christchurch and Dunedin. Based on 2.65 people per house, each area is building more houses than are required for the population growth. Napier is the worst by far with 182 consents but only 209 population growth over the last year.
Ross
Population Growth vs Number of Houses Being Built
In our January 2016 Blog, we looked at these stats. I have now updated them for the last year.
Hamilton
- From the 2006 to 2013 census, the population grew 12,024 to 141,612. This is an increase of approximately 1,700 per year.
- HCC 10 year plan 2015 to 2025 "projected to grow from 153,000 in 2016 to 174,000 in 2025", or 2,100 to 2,300 approximately per year.
- Statistics NZ show 1,179 new dwellings from January 2016 to December 2016.
- From our January 2016 Blog, average 2.65 people per house.
- New dwellings can house 3,124 new people in the year.
From this information, Hamilton is building more houses than it requires by around 350 houses or to accommodate 924 people. This could be catching up a shortage. I would, therefore, be cautious buying in Hamilton and make sure the figures really work. It will be interesting to watch rental statistics over the next year to see if there are excess rentals!
Need 830 new houses per year Vs Building 1,179
Waikato
- From the 2006 to 2013 Census, the population grew 22,815 to 403,638. This is an increase of approximately 3,300 per year.
- Statistics NZ showed 2.3% growth to June 2016 or 10,000 approximately per year.
- Statistics NZ show 3,552 new dwellings from January 2016 to December 2016. November 2014 to October 2015 was 2,756, so 796 more than around a year before.
- From our January 2016 Blog, average 2.65 people per house.
- New dwellings can house 11,903 new people in the year.
From this information, Waikato is building pretty much the perfect number of houses.
Need 3,585 new houses per year Vs Building 3,552
Tauranga
- From the 2006 to 2013 Census, the population grew 10,905 to 114,789. This is an icnrease of approximately 1,600 per year.
- Tauranga City 10 year plan 2015 to 2025, 579 growth 2018-2023, or 1,900 approximately per year.
- Statistics NZ show 1,695 new dwellings from January 2016 to December 2016.
- From our January 2016 Blog, average 2.6 people per house.
- New dwellings can house 4,407 new people in the year.
From this information, Tauranga is building more houses than it requires by around 950 houses. I would, therefore, be very cautious buying in Tauranga and make sure the figures really work. It will be interesting to watch rental statistics over the next year to see if there are excess rentals!
Need 732 new houses per year Vs Building 1,695
BOP new dwellings, 2,520 from January 2016 to December 2016. November 2014 to October 2015 was 1,734, so 786 more than around a year before.
Auckland
- From the 2006 to 2013 census, the population grew 110,589 to 1,415,550. This is an increase of approximately 16,000 per year.
- Statistics NZ showed 2.8% growth to June 2016 or 41,860 approximately per year.
- Statistics NZ show 9,930 new dwellings from January 2016 to December 2016. November 2014 to October 2015 was 8,935, so 995 more than around a year before.
- From our January 2016 Blog, average 3 people per house.
- New dwellings can house 29,790 new people in the year.
From this information, Auckland is not building enough houses to keep up with demand, and is approximately 4,000 houses short in one year! This is similar to the stats a year ago, and Auckland seems to be getting further and further behind.
Need 13,953 new houses per year Vs Building 9,930
When you look at this information overall, it is concerning that Hamilton, Waikato, and Tauranga seem to be building considerably more houses than required. This could create a large over supply and a possible 'bust'.
It appears that a lot of the lift in property prices in Hamilton, Waikato, and Tauranga is due to greed and the ripple effect, rather than being based on the true fundamentals of supply and demand.
Auckland, on the other hand, has a well-documented shortage, and over the last year the housing shortage has gotten worse by 4,000 houses. If immigration stays high and the Auckland population continues to grow, then I still cannot see Auckland house prices crashing. While there might be a flat period or blip, economics suggest that Auckland house prices will continue to rise.
Kind regards
Ross Barnett
I also had a quick look at Napier, Palmerston North, Wellington, Christchurch and Dunedin. Based on 2.65 people per house, each area is building more houses than are required for the population growth. Napier is the worst by far with 182 consents but only 209 population growth over the last year.
Ross
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