Increasing interest rates may be cooling the housing market, but a nationwide shortage of building materials coupled with general inflation has steeply increased the cost of new buildings.
Lockdowns and extended Covid›19 measures in Auckland have caused pauses in manufacture of some building staples, and last week merchants announced they would not deliver to builders’ depots or sites that might be stockpiling.
Balclutha builders, who asked not to be named, described a ballooning rate of thefts that had exacerbated the issues caused by rising prices.
One builder said a local contractor had had 56 sheets of plywood stolen off his site recently.
‘‘His tools and a trailer were ignored. Four weeks ago I wasn’t worried about it but in the last weeks there’ve been a lot of thefts,’’ he said.
‘‘Since the beginning of last year’s lockdown [in August] I’d say standard [90mm × 45mm] framing timber has gone up about $1.30 a metre.
‘‘Tradies are concerned what their workload is going to be like. The jobs are there but it’s not knowing how long it’s going to take to get them done, so subtrades especially are putting jobs off because they don’t know when they’re going to able to get gear.’’
A second builder said there was also a perception of ‘‘market manipulation’’ regarding supply.
‘‘There’s a feeling that a lot of our construction materials are controlled by a small number of people.
‘‘The availability isn’t there, [Gib] stopped taking orders about seven weeks ago,’’ he said.
A Fletchers Winstone Wallboards press release contained Stats NZ figures showing in the year ended September 2021, 47,331 new dwellings were consented — up 25% for the year.
This record level of activity has caused an increased demand for all building materials, including insulation and plasterboard which has outstripped production capacity.
Winstone Wallboards (WWB) manufactures and supplies plasterboard products to merchant customers such as Carters and Mitre 10.
After discussions with merchants, WWB has decided the best short› term solution will be to allocate plasterboard to merchants based on their previous ordering level history. This ‘‘on allocation’’ model is intended to enable merchants to distribute the board they receive equitably across their customers based on real›time need, aiming to get more board to building sites when required for installation and reduce the time product is stored before use.
A $400 million Winstone manufacturing site under construction in Tauranga is on track to be operational by June 2023, and is expected to have the capacity to meet demand.
‘‘We recognise it’s tough for people who haven’t secured plasterboard ahead of needing it on a build and we’re doing as much as we can to increase volume to the market,’’ a Fletcher Building spokesman said.
‘‘WWB is operating two plants 24/7 and dispatching record levels of plasterboard — enough for 1000 new, average›sized New Zealand homes per week — but demand is still outstripping production.
‘‘It’s important that customers needing plasterboard engage early with their local merchants about their specific needs and timings, as they are ultimately making the decisions for allocating their plasterboard stock across their customer base.’’
Balclutha builders acknowledged contractors had been used to getting what they need as they need it, but under current conditions everyone was learning they had to plan ahead much further.
‘‘There’s plenty of work on so the biggest thing is you have to be so much more organised, you’re looking six to seven months ahead to try and make sure you’ve got gear on.’’