Building consents still top $1billion - Wanaka leads the charge

4 minutes read
Posted 17 August, 2023
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A total value of $1.076 billion worth of building consents was processed for the Queenstown Lakes District for the financial year ending June this year – 1585 consents, down 15 percent on the previous financial year.

However, council data shows the total value of consents processed has still increased from $1.064 billion the previous year, despite 235 fewer consents being processed.

QLDC Team Leader Building Consent Processing, Hamish Humphries says it’s the first time the number of consents has dropped for some years. He says there’s been a slight downturn in the last year but that’s not necessarily reflected in the total value of consents which continues to climb, probably due to rising building costs and inflation.

It's all go in Wanaka construction with that side of the hill accounting for almost half of the building consents issued. “That used to be 30 percent two or three years ago,” says Hamish. There’s still demand in the Wakatipu too, but he says construction has very much caught up with available development land around Queenstown, while Wanaka, Hawea and Northlake appear to have land available and ready. “Hanley’s Farm has released and sold more sections, but the developers can’t get the roads and services in as quickly as the construction companies can build houses so there’s a lag.”

Queenstown, Wakatipu and Arrowtown account for approximately $654 million worth of this last financial year’s consents value - 865 consents issued, but Wanaka alone clocked $429.6 million worth – 720 consents. “There’s definitely been more activity there,” says Hamish. “There’s a lot of land in Hawea, Luggate and the likes already developed in the Upper Clutha, readily available land, he says. “However, they’re waiting for land so they can start building in the likes of Hanley’s.”

There’s been a noticeable increase in multi-unit dwelling consents (residential flats) around Queenstown and Wanaka as homeowners can no longer afford to just build one standalone dwelling, says Hamish. “It’s not just families, but investors and a range of applicants. It’s becoming a trend to maximise capital out of the land.”

“We’re seeing this more and more, year on year, in subdivisions in both areas, people building a three-bedroom house and separate guest house for Airbnb or rental.” About half of the homes being built at Hanley’s Farm now have an attached flat or unit, he says. In Shotover Country that’s probably closer to 25 to 30 percent, while in Lake Hayes Estate, developed 15 years ago, probably only about 15 percent of homes have a separate unit. There’s probably a range of scenarios but the units are likely being used for Airbnb to help offset mortgage payments and inflation costs, he says.

While the Queenstown Lakes District is still in the top five districts in the country for its high building consent values – on average about $600,000 per consent this past financial year, not all of those are actual dwellings.

District building consent values first topped $1 billion in the financial year ending June 2019 when a total 1800 consents were issued worth $1 billion, dropping down to about $790 million the following year due to Covid interruptions. Values reached more than $1 billion again for the year ending June last year.

Meanwhile, 1151 resource consents were issued throughout the district last calendar year – 586 until June 30 last year, down slightly so far to 555 for the same period this year.

However, QLDC Team Leader Resource Consents Kenny Macdonald says the numbers, which peaked at 1901 for 2018 and 1851 for 2019, only tell one side of the story. “I personally believe there’s only a slight slowdown as our numbers were skewed by applications like special housing areas and one big swathe of applications to formalise Airbnbs that weren’t new,” he says.

However, the last few years have been intense and busy. “We expected numbers to fall off after Covid, but they didn’t.”

Council staff are still seeing high numbers of new Airbnb short term rental applications. “That’s consistent. They’re still coming in regularly,” he says.

There’s plenty of building going on at Hanley’s Farm, Northlake and Hawea with subdivisions still going through, he says. Despite the record low interest rates a few years ago resource consent numbers remain about the same. “I wondered if higher mortgage interest rates may have dampened things down, but they haven’t and that’s backed up by the consistency in our numbers.”

Staff shortages in all sectors, not just at the council, but in other industries like planning engineering and landscape architecture, have also slowed the consent process. “We’re catching up as we move forward. We’re filling those roles, but it’s still difficult to get staff at the senior planning level.”

Despite this council staff are still meeting close to 90 percent of consent applications within the statutory 20 working day target timeframe. “Typically, over the last six months that’s been on average 18 to 20 days again.”


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