Kapiti Coast District Quarterly economic monitor - September 2017

Overview

Indicator Kapiti Coast District Wellington Region New Zealand
Annual average % change
Gross domestic product
3.8%
2.1%
2.5%
Traffic flow
3.2%
3.0%
2.3%
Residential consents
33%
15%
3.0%
Non-residential consents
20%
24%
5.9%
House prices*
15%
7.2%
3.1%
House sales
-15%
-15%
-17%
Guest nights
3.1%
0.2%
2.6%
Retail trade
3.8%
3.4%
3.8%
Car registrations
16%
7.6%
9.4%
Commercial vehicle registrations
35%
23%
19%
Jobseeker Support recipients
4.5%
-1.5%
0.6%
Tourism expenditure
5.3%
2.7%
6.4%
Level
Unemployment rate
4.9%
5.0%
4.9%
International net migration
215
3,881
70,983
* Annual percentage change (latest quarter compared to a year earlier)

Overview of Kapiti Coast District

Kāpiti’s economy grew by 3.8% over the September year, according to Infometrics’ provisional estimate of GDP. This positive result follows growth of 3.6% the previous year. Indicators of spending and investment are expanding sharply, particularly those related to construction. Traffic flows rose 3.2% in the September 2017 year.

Population growth in Kāpiti Coast District remained strong over the past year. Statistics New Zealand estimates that Kāpiti’s population grew by 1.2% over the June year, following 1.4% the previous year. By comparison, population growth has averaged 0.9%pa over the past 10 years.

These additional people have added significantly to demand in Kāpiti. Electronic card data from Marketview shows that retail spending in Kāpiti climbed 3.8% over the September year. Car registrations increased by 16%, while residential building consent numbers rose 33% over the same period.

Job ads data has shown increases to the number of positions being advertised in the lower North Island. Nevertheless, there are still some workers in more vulnerable positions, with the number of people seeking Jobseeker Support rising slightly. But the prospect of increased government spending bodes well for those commuting to Wellington for public sector jobs.

Business spending and investment remain buoyant. Commercial vehicle sales increased 35% over the past year, while the value of non-residential building consents climbed 20%. The most recent BNZ-BusinessNZ Performance of Services Index and Performance of Manufacturing Index survey pointed towards continued expansion of business activity across the lower North Island.

Kāpiti’s tourism sector is growing. Commercial guest nights rose 3.1% over the September year, while visitor spending increased 5.3%. Infometrics’ analysis of Airbnb data shows that the number of Airbnb listings rose from 185 in October 2016 to 375 in September.

Overview of national economy

The New Zealand economy had a healthy September quarter. A rosy economic growth outlook, and signs that inflation is set to increase, raise the prospect of mortgage rates beginning to creep up later next year. More expansionary fiscal policy under the Labour government is a key driver of the solid GDP outlook. But capacity constraints in the residential construction sector remain a key risk.