Driving around Hastings, Havelock North and Napier the last few weeks on the normal holiday and summer errands (rain notwithstanding), one would conclude that Hawke’s Bay was enjoying boom times. People and cars all over the place … actual congestion! And a gazillion construction projects, large and small.
But then read the expert economists’ reports.
Says ASB in its latest regional report:
“Hawke’s Bay slid down two positions, standing at 13th on our Scoreboard. The region was below the national average for most of our indicators and, sadly, lost a star this quarter. Workforce shortage is one of the main culprits for the region’s setback as well as high input costs; making it harder for local producers to put their best foot forward. On top of this, our local apple growers had to battle rain that poured down in torrents. Consumers are on the pessimistic side too for the quarter.”
That’s 13 out of 16 regions … pretty close to the bottom.
And then a report from independent economist Tony Alexander on property developments across the regions; here’s what he says about Hawke’s Bay:
“…average [house] prices remain well above their long-term trend relationship with the country overall and the region is vulnerable to a stronger correction downward should special negative factors emerge – such as collapsed consumer confidence and worries about recession.
“…when it comes to changes in the number of consents being issued for new dwellings to be erected, the region is starting to aggressively under-perform. Consent numbers have declined by 29% in the past year versus a 5% rise nationwide.
“In the three months to October the number of consents issued was down by 45% from a year ago versus a 2% fall NZ-wide. I have for some time been warning about an imbalance in housing availability in some regions and Hawke’s Bay in particular on the basis of people over-estimating the ability of population to keep growing at the special relative pace caused by the pandemic. The collapse in consent issuance underway may prevent a substantial fall in prices but will likely see much pain for builders in the region.”
And talk to anyone in the region’s horticulture sector and it’s totally doom and gloom given the whacky wet weather we’ve had. Berries and cherries took the first hit, but all stonefruits are down 25% and veggie farmers are having trouble getting crops planted, given the wet soils.
On the other hand, although contending with workforce shortages, our hospo sector seems ‘cautiously optimistic’, as you can read in our Jan/Feb BayBuzz mag.
So, which is it … boom or bust? Crowded shops today, heaps of visitor bookings, a crowded event schedule for the summer, but on the other hand, for our growers, the mainstay of our region’s economy, the new year is looking grim.