Economists warn higher costs could test developer confidence
New Zealand consented 39,087 new homes in the year ended April 2026, up 16% from the previous year, with multi-unit dwellings driving more than half of that growth, according to Statistics New Zealand (Stats NZ).
Stats NZ economic indicators spokesperson Michelle Feyen said the annual rise was broad-based across dwelling types. Townhouses, flats, and units led the way at 16,832 consents, up 19%, while apartments rose 27% to 2,656 and retirement village units increased 13% to 1,699. Stand-alone houses also gained, reaching 17,900, up 14% over the year.
Feyen said April’s monthly apartment surge was notable: “There were a large number of apartments consented this month, the highest since November 2022.”
In April alone, 3,692 homes were consented, up 53% from April 2025. Apartments led the monthly increase, soaring 524% to 499 consents, although Stats NZ cautioned that apartment figures can fluctuate sharply because large projects are often processed in batches. In seasonally adjusted terms, consents rose 11% in April compared with March, following a 0.8% fall the previous month.
Regionally, Auckland recorded the highest volume, with 16,687 consents for the year, up 21%, while Canterbury posted the strongest growth rate at 29%, reaching 8,386 consents. Waikato, Otago, and Wellington also recorded gains. On a per-capita basis, Canterbury and Otago led the country at 12.0 and 10.8 new homes per 1,000 residents, respectively, both ahead of Auckland’s 9.2 and the national average of 7.3.
Outlook uncertain despite gains
Westpac senior economist Satish Ranchhod described the consent figures as an encouraging sign for the building industry but questioned whether the momentum would be sustained into 2027.
Ranchhod noted that April’s sharp monthly rise was heavily influenced by a batch of Auckland apartment consents, which he expected would ease in the following month. However, he said underlying conditions also appeared firmer for stand-alone homes and townhouses, and that overall consent volumes – at their highest level since 2023 – pointed to stronger building activity in the months ahead.
Despite that near-term optimism, Ranchhod highlighted a range of headwinds facing developers. Conflict in the Middle East has pushed fuel costs higher, flowing through to construction material costs, with some increases described as substantial. Borrowing conditions have also tightened, with mortgage rates already rising and the Reserve Bank of New Zealand signalling possible increases to the Official Cash Rate in the months ahead. Ranchhod said that, combined with subdued house price growth and broader economic uncertainty, developers were likely to remain cautious about starting new projects.
Commercial sector subdued
On the non-residential side, Westpac said the value of commercial building work consented had effectively tracked sideways over the past two years. Ranchhod attributed that trend to resilience in industrial and storage developments offsetting weaker retail activity.
Looking ahead, Westpac said developers and occupiers were likely to remain cautious about committing to new commercial space given increased uncertainty around economic growth and rising financing costs. Recent business surveys, Ranchhod noted, had shown declines in both business confidence and investment intentions.
