Construction downturn bites hard: 'It's tough out there'

One Auckland-based housing block, which featured 108 modular units, was once promoted as the way of the future.

Now, it is abandoned, with its' builders in liquidation owing millions of dollars — yet another example of the downturn in construction.

Builderscrack.co.nz co-founder Jeremy Wyn-Harris told 1News work is more "scarce" than it has been.

"People are going out of business, it's tough out there. There are opportunities there — it's just a lot harder to secure work."

Issues in the construction industry are rife — the number of building consents have fallen by 23%, and apartment consents specifically have fallen by 52%, in the last year.

Gareth Kiernan, chief forecaster and operations director at Infometrics said New Zealand was heading towards having a "greater undersupply" of housing.

"The banks have tightened up their funding considerably for some of those multi-unit developments, so that's made it increasingly difficult for people to go ahead with those projects," he said.

"There was a period there through [Covid-19], with borders shut and little population growth, that we were catching up... the bad news is that we are now heading back in that direction of a greater under-supply."

The under-supply of houses coincides with Housing Minister Chris Bishop sharing a "letter of expectations" for Kāinga Ora — the Crown agency that provides rental housing for New Zealanders in need — to "cut your costs, operate efficiently and effectively and focus on your core functions of being a landlord for vulnerable people in need".

With those expectations, a change to the board occurred with five members departing and six new members appointed.

The new members have been instructed by Bishop make a plan "around the precise mix of build, sales, maintenance and retrofits" as Kāinga Ora has been instructed by the Government to stop building houses and start being a landlord.

The plan was due by November, with tradies hoping they would soon be back on the tools and building again.