Building work put in place

Non-residential work hammered as residential softens further

5 Mar 2026

Gareth Kiernan

Our take on the latest Building work put in place (Thu 5 Mar 2026)

Non-residential activity

Residential activity

Total building activity

6.5%

1.1%

From September 2025 (sa)

At its lowest level (excl lockdowns) since 2015

The key numbers...

Although building consent data had been less negative in the second half of 2025, work put in place finished last year on a weak note, with the volume of activity down 3.1% from the September quarter (seasonally adjusted) and 4.9% from a year earlier in December 2024.
Non-residential activity was particularly weak, as the downturn in consents during the second half of 2023 and 2024 flows through into construction activity levels, as we had warned. Non-residential activity in the December 2025 quarter was the lowest since 2018, with the 6.5% seasonally adjusted fall from September the largest quarterly decline since 2014, and the 11% drop from December 2024 the biggest since 2011 (all comparisons excluding COVID-19 lockdowns).
The declines in residential activity were not as marked, with falls of around 1% in work volumes from the previous quarter and a year earlier. However, the December result was the lowest level of residential activity for any quarter since 2015 (seasonally adjusted, excluding lockdowns).
New residential activity is stabilising, in line with consent trends over the last 18 months, but residential alterations work is still falling as the pipeline of consents shrinks. The value of alterations activity dropped 5.6% from December 2024 and 25% from two years prior.
Farm building (up 17%) and education building (up 6.7%) were the only non-residential build types to record an annual increase in the value of work put in place. Five of the other seven non-residential build types recorded double-digit declines in the value of activity compared with December 2024.
The value of activity was higher than a year ago across both Canterbury and the rest of the South Island. Outside Canterbury, the growth was underpinned by more residential building, while Canterbury recorded increases for the value of both residential and non-residential activity.

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...and our reaction

Today’s results were slightly below our expectations for both residential and non-residential activity (1.2% and 0.4% below forecast respectively). They confirm that the construction industry remains under pressure, particularly when a 2.2% downward revision to September’s residential total is also considered.
The annual total of non-residential activity is now down 13% from its early-2024 peak, compared to a 19% fall in the volume of consents since mid-2023. These lower consenting volumes will continue to drag non-residential work put in place lower throughout the rest of 2026.
Prospects for residential activity are less negative, with the annual dwelling consent total lifting by 10%, to almost 37,000pa, since May last year. We expect to see more stable residential work put in place figures over the next few quarters.
The divide between trends in the North and South Islands is consistent with other economic indicators showing better activity levels in the South. However, we note that growth in the total value of activity in Auckland has improved to -2.5%pa, the least negative result in almost two years, which is important for the industry given that Auckland makes up 40% of nationwide construction activity.

Latest updates

Premium

Building work put in place

Non-residential work hammered as residential softens further

The key numbers...

...and our reaction

Latest updates

Strong lift in residential construction

Construction activity at a 10-year low

Non-residential activity continues to decline