Thursday, July 18, 2024

Buller bucks GDP growth trend

Buller’s Mayor has heralded the district’s double-digit GDP growth for the year ending March 2022 as a solid achievement considering the flood events and ongoing challenging economic climate the region has faced.

According to a report released this week, the district’s GDP grew 15% in the year to March 2022. In the year ending December 2021, the Buller’s GDP increased by 12.3%. This ranks the district as the second fastest growing district in the country twice in a row.

“Achieving 15% growth, compared with an average of 5.2% in New Zealand and 9.3% on the West Coast, is very encouraging. Our district continues to perform well above the national trend,” said Mayor, Jamie Cleine.

“Our local economy has been impacted by the Omicron outbreak, staff shortages, severely interrupted supply chains, and businesses struggling to find skilled workers and materials.  On top of this we dealt with two major flood events.”

The report states that also consumer spending has been up by 10.2% for the year ending March 2022 compared with the same period 2021. This is above the national average of 6.1% and 7.6% on the West Coast.

Total tourism expenditure in the Buller District increased by 9.8% in the year to March 2022. The growth has more than counterweighted the loss of international visitors highlighting how well Buller attracted New Zealanders throughout the pandemic years, the Mayor said.

The number of residential consents also rose over the past 12-months by 94% compared with the previous  12-month periods .

“It is great to see that our economic indicators are punching above the national trend on such a wide spectrum ranging from tourism, to construction and agriculture, with the dairy payout for the 2021/2022 season to be expected to be $24 million higher than last season,” said Mayor Cleine.

The district recorded a hard drop in the average house value which declined by 8.3% in March 2022, compared to a year earlier. This sits against a growth of 9.1% on the West Coast overall and an average increase in house value in New Zealand of 17.7% over the last 12-months.

Matching this figure, house sales in Buller felt sharply by 36.1% in the year to March 2022. This decline fits the national trend of fewer houses changing hands in New Zealand (down 9.3%) and on the West Coast (down 24.2%).

“We definitely can see the impact of the flood events reflected in the drop in house sales and value, which was the biggest drop in the country.”

“It follows that this could be due to the situation caused by the July 2021 and February 2022 floods. People might sell off their flood damaged houses as bargains now, and owners are waiting for repairs and insurance pay outs, hence fewer houses are on the market.

“In the year to September 2021, house values in Buller sky-rocketed by 34%, causing ordinary houses to be sold for extraordinary prices. Dropping from such a high level leaves a smaller net loss of house values than the figure suggests.”

He said expectations remain for ongoing staff and material shortages paired with increased prices and accelerating inflation to challenge economic growth into 2022.

Mr Cleine says that the impact of these difficulties would not bypass the district.

“The report clearly outlines that the remainder of the year could see the New Zealand economy slow down due to staff and material shortages. Also increased inflation, rising interest rates, and higher fuel prices will have their impact.”

“We have done well so far sailing relatively smoothly through the pandemic. Our district is in a good position to brace what the remainder of 2022 brings,” he said.

The Infometrics Quarterly Economic Monitor publishes regularly reports about local economies for the quarters ending March, June, September, and December.

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