Rebuild easing off responsible for district’s economic slow down

UNDER CONSTRUCTION: A house under construction in Rolleston.

Construction activity easing off from peak rebuild levels has led to Selwyn’s economy slowing during the first half of the year, a new report shows.

Economic consultancy group Infometrics says the district’s growth domestic product had increased 1.1 per cent in the year to June, compared to a 4.7 per cent growth the previous year.

Selwyn’s real estate market faced a challenging autumn and first half of the winter with house sales falling 4.8 per cent.

The report said this pattern trends with Christchurch where post-earthquake building has rapidly pushed up supply against demand.

House sales in the Canterbury region have fallen 8.6 per cent.

Deputy Mayor Malcolm Lyall said the decrease is most likely reflected on the fact the building boom in Christchurch has tailed off.

House prices had increased by 2.4 per cent.

Ray White town and life principal Brendan Shefford said the sales could be a whole lot worse if it hadn’t been a naturally growing area and the magnitude of sales were always going to slow down.

He said it was great news house prices had increased.

Matson and Allan Real Estate Ltd agent Jackie Derrick, who mainly covers Rolleston, said once people come to the township they generally don’t leave.

She said this could be one of the reasons contributing to the decline in house sales.

In other sectors, the report showed Selwyn’s total dairy payout in the 2016/17 season was $420 million, up more than $150 million from the previous year but down from the $533 million payout in the 2013/14 season.

While accommodation guest nights had decreased by 12 per cent, tourism expenditure had increased by 7.9 per cent.

The district council’s community relations manager Denise Kidd said there is a number of reasons for the decrease in the guest nights.

Ms Kidd said it could be due to accommodation establishments being closed for renovations or owners taking a holiday.

Other reasons could be related to significant changes to travel patterns as a result of the Kaikoura earthquake and Christchurch opening new accommodation establishments.

Mr Lyall said the district council is always looking for new activities for tourists to do as they tend to drive through Selwyn.

“The more attractions we can put together and the more places we can explain to people to visit the better off we are for our local economy,” he said.

The report showed positive increases in economic growth in other areas for the district.

The retail trade had grown by 7 per cent, jobseeking 14 per cent and commercial vehicle registrations 2.5 per cent.

Mr Lyall said it has got to be good a growing community is employing its own people.

“That is always something we strive for. It is one of the reasons we were behind the Izone Business Hub. They wanted to provide local employment for local people,” he said.

But the unemployment rate was 2.3 per cent, up from 2 per cent a year earlier.