Kapiti Coast District Quarterly economic monitor - June 2018

Overview

Indicator Kapiti Coast District Wellington Region New Zealand
Annual average % change
Gross domestic product
1.5%
2.5%
2.7%
Traffic flow
3.7%
4.4%
3.1%
Residential consents
-17%
29%
7.9%
Non-residential consents
-42%
-30%
10%
House prices*
10%
8.6%
4.9%
House sales
0.09%
-6.6%
-7.0%
Guest nights
-1.1%
0.8%
2.4%
Retail trade
4.0%
4.6%
4.4%
Car registrations
6.3%
1.6%
1.1%
Commercial vehicle registrations
-11%
15%
5.4%
Jobseeker Support recipients
-2.8%
-0.3%
0.05%
Tourism expenditure
-0.6%
6.3%
8.5%
Level
Unemployment rate
4.1%
4.5%
4.5%
International net migration
207
3,409
64,996
* Annual percentage change (latest quarter compared to a year earlier)

Overview of Kapiti Coast District

Consumers are leading the way in Kāpiti Coast District at the moment on the back of continued growth in house values. The district economy continues to grow at a relatively subdued pace with Infometrics’ provisional GDP estimate showing growth of just 1.5% in the June 2018 year next to 2.5% growth in the Wellington region and national growth of 2.7%.

Nationally, consumers are holding back on vehicle purchases due to rising fuel prices and pessimism about the state of the economy. But Kāpiti consumers just keep on spending: electronic card spending on retail purchases in the district grew by a healthy 4.0% in the June 2018 year, a shade under national growth of 4.4%. Car registrations are up 6.3%, well ahead of national growth of just 1.1%. Traffic flows, another good indicator of economic activity, are up 3.7% in the June 2018 year, which is just above the national average of 3.1%.

In the District’s housing market, house prices rose 10% in the June 2018 year - twice the national average. This was caused by demand pressures from population growth. However, residential consents in the District are down 17% and non-residential consents are down 42% which is a cause for pessimism among the local construction industry. Builders tend to drive commercial vehicle registrations so it’s no surprise then to see registrations down 11% in the June 2018 year.

The District’s tourism sector is having a tough time. Guest nights are down 1.1% in the June 2018 year and tourism expenditure is down 0.6% in contrast to 8.5% growth nationally.

Economic activity is, however, resulting in more jobs. The average number of Jobseeker Support recipients is down 2.8% in the June 2018 year. Nationally, the number rose slightly by 0.05%. The District’s unemployment rate has also fallen. Infometrics’ estimates show that Kāpiti’s unemployment rate averaged 4.1% in the June 2018 year, down from 4.2% in the March 2018 year and its lowest level since 2009.

Overview of national economy

Most of the New Zealand economy’s momentum over the next 18 months will come from provincial areas, thanks to strong export incomes. Low business confidence suggests that domestically focused firms are already reluctant to invest or hire. Households are also becoming more cautious about their spending in the face of higher fuel prices and the slowing housing market. The New Zealand economy needs the continuation of good export conditions to maintain a solid growth performance.