Builders Doing It Tough - What It Means for Short Term Rentals

By Scott Mears - Aspire PRI Enterprises

The latest Builder Sentiment Report paints a rough picture for New Zealand’s construction industry. With firms operating at just 64% capacity (down from 83% in 2022), it's clear: building in NZ is harder than ever. But while that’s tough news for tradies, it could quietly be reshaping the landscape for short-term rental (STR) investors.

Here’s why.

Fewer new builds mean fewer properties entering the market. The government's cutbacks, like cancelling 212 Kāinga Ora projects haven’t just paused social housing; they’ve stalled momentum across the entire sector. That bottleneck is pushing more pressure onto existing stock. For STR investors, this is a double-edged sword: on one hand, less competition from shiny new homes; on the other, tighter availability could drive up purchase prices as demand rebounds.

And it will rebound. Builders are bracing for it. They’ve weathered two years of downturn by shifting into renovations, school work and cyclone repairs - anything to keep going. But there’s growing worry they won’t have enough skilled hands when the market turns. Apprenticeships are down 25% since the 2022 peak and Aussie is poaching talent ahead of the Brisbane Olympics.

So what does this mean for STR buyers and owners?

It means that buying existing homes - especially well-located, STR-suited ones - is still a smart play. With new builds lagging and population demand steady (or even climbing), solid homes in good areas will be in hot demand. And if you're already in the game? Investing in upgrades or maintenance now (while tradies are still available) could save you headaches and cost later.

In short: less building means more pressure on what's already out there. For STRs, that might just mean your time is now.