Buller keeps going
Buller District’s strong economic performance continues despite the difficult economic climate for the quarter ending June 2022 according to a report released last week.
The Buller District’s GDP grew 4.9% in the year to June 2022, however fell sharply in the June quarter. West Coast region overall led New Zealand in economic growth with a GDP increase of 4.2% in the year ending June 2022 but experienced the same sharp dip over the three months ending June.
Buller District Council Mayor Jamie Cleine says this is great news in challenging times for Buller and the West Coast region.
“Achieving 4.9% growth, compared with an average of 0.9% in New Zealand, is very encouraging. Our district and the West Coast region continue to perform well above the national trend. However, the sharp decline shows that we are not immune to the difficult climate that has taken its toll on the economy over the June quarter 2022.”
Mr Cleine highlights that consumer spending in Buller has been impacted by the high inflation in New Zealand reaching levels not seen in over 30 years.
“National inflation of 7.3% for the year to June 2022 is higher than the increase in consumer spending in Buller with 4.0% pa, meaning that the high inflation out weighted consumer spending.”
The report states that total tourism expenditure in the Buller District felt by 10.4% in the last year, however the district is still sitting above pre-pandemic levels.
Mr Cleine says: “This reflects how the district has done well to grow its share of the domestic market, which is now smoothening the impact of the recent slowdown in domestic travel.”
The number of non-residential consents softened by 12.7% since June 2021, however this places Buller still significantly above the district’s long-term average. Residential consents are up by 47.9% compared with the same 12-month period a year before.
Elevated global dairy prices may also help boost Buller’s economy with an expected dairy payout $24m higher than last seasons.
Mr Cleine says: “It is great to see that our economic indicators are looking positive in these difficult times on such a wide spectrum ranging from tourism, to construction and agriculture.
There is still a large amount of construction work to be done, with an additional 11 residential dwellings consented in just this quarter, but we are aware that we are heading towards the tail end of the flood recovery work.”
The district recorded a sharp drop of 50.4% in house sales in the last year, compared to a year earlier. Matching this trend, house sales on the West Coast felt steeply by 38.4% in the year to June 2022. This decline fits the national trend of fewer houses changing hands in New Zealand (down 26%).
Mr Cleine says: “We can see the distorting impact of the flood events reflected in the deep drop in house sales. Clearly Buller is not alone considering that country wide, house sales in the three months to June fell at the fastest rate since October 2010, excluding the lockdown months in mid-2020.”
Buller and the West Coast region recorded a solid increase in house values being the highest in New Zealand. Buller is leading the West Coast districts with 37.8%, adding to the region’s overall growth of 33.7%. The average increase in house value in New Zealand was 9.6% over the last 12-months.
Mr Cleine says to put the good news in context.
“The increase in house prices is a growth but a substantial slowdown from the fast and steep growth recorded in late 2021. In these two years, house values especially in Buller sky-rocketed, causing ordinary houses to be sold for extraordinary prices.”
Expectations remain for rising interest rates, and high inflation to challenge economic growth for the remainder of 2022.
Mr Cleine says that the impact of these difficulties will not bypass the district.
“The report clearly outlines that the New Zealand economy has been impacted by high inflation, lower consumer confidence, rising interest rates, and ongoing staff and supply chain issues over the last quarter.
These external factors will impact our district but we have so far sailed relatively smoothly through the rough last quarter. Our district has done well over the last couple of years and is in a good position to brace what the remainder of 2022 brings.”
The Infometrics Quarterly Economic Monitor publishes regularly reports about local economies for the quarters ending March, June, September, and December.
-ENDS-
For more information please contact:
Mayor Jamie Cleine
Buller District Council
Jamie.cleine@bdc.govt.nz