Not for sale developments could help tide builders and other tradies over during the current slump, CBRE NZ says. File pic Photo: RNZ / Nate McKinnon
A rise in build-to-rent and social housing projects could keep the construction sector ticking along during a downturn in activity.
New research from commercial real estate firm CBRE New Zealand showed the number of for-sale apartment development projects in the pipeline, 61, is equal to the number of not-for-sale projects for the first time in almost 10 years.
Associate director of research Tamba Carleton said not-for-sale developments could help to tide the industry over during the current slump.
"This data is indicative of one way in which developers might be able to move forward and finance their builds, a way to stay active," she said.
"On 8 May, the government announced the second round of the Build Ready Development pathway which has two things to support the construction industry in this downturn.
"First, buy development-ready land, particularly in town centres along transport corridors, and, second, underwrite pre-sales to unlock development finance."
Carleton said it was important for developers to ensure they were building the right product at the right price and in the right place.
"It is interesting to see the non-saleable sector growing by a net of three in the last quarter, which in our view is indicative of people starting to see the pathway ahead of them, particularly as the number of Kainga Ora projects hold steady (33 in Q4 2022, and 35 in Q1 2023)."
