Govt predicts boom year for house builders

Builders will put up 18,000 to 20,000 new houses this year, according to a forecast.

The building and construction outlook, a quarterly report from the Department of Building and Housing, says the recession is over for house builders.

The slump has bottomed out and housing consents have been rising so the sector will see much higher levels of activity this year.

Evidence is also beginning to emerge that construction prices are rising although generally costs are suppressed, the report said.

"Homebuilding costs are no longer rising at above the rate of inflation," the update said.

"The sharp drop in demand has meant there is still spare capacity in the industry, even with the exit of some smaller players, and the tender process is more competitive than it has been for several years as builders chase a smaller amount of work.

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Posted: 17 Feb 2010

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