Q1 2024 Oceania Market Construction Update [Wellington]: Wellington’s construction market presents a complex picture, with positive trends offset by several challenges.
Wellington’s construction market presents a complex picture, with positive trends offset by several challenges.
The city is experiencing significant demand for construction services, fuelled by infrastructure projects and residential development, such as the regeneration of Te Aro.
However, labour shortages persist as a major obstacle, with the industry facing difficulties in finding and retaining skilled workers—a problem that is not unique to Wellington but prevalent nationwide.
In addition, supply chain issues and rising labour costs are placing pressure on builders and developers, which could lead to project delays and increased costs.
Key factors impacting escalation
- The outcome of the general election and increased fiscal restraint are impacting forecasts for the industry, potentially leading to reduced growth and investment
- Trade pricing is stabilising due to heightened competition, which could lead to more predictable project costs
- Residential construction activity has slowed in recent months, indicating a potential downturn in this sector
- Variations in trade pricing for large and complex projects reflect differing risk assessments and the clarity of future workload, affecting project budgeting and planning
- Skilled labour shortages that reduce productivity, delay projects, and increase wage costs remain a concern
Photo: RLB provided quantity surveying services on Tākina Wellington Convention & Exhibition Centre, a Wellington City Council public and civic development.
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