PHOTO:ALDEN WILLIAMS/STUFF Unemployment, low population growth and weaker house prices will all pummel demand for new houses, BNZ says.
The BNZ has sounded alarm for the residential construction industry, saying house prices are likely to fall 12 per cent.
Head of research Stephen Toplis said the bank was very unsure construction would be the economic saviour people were hoping for, given the big obstacles in its way, the biggest being unemployment.
”We are now witnessing one of the most rapid increases in unemployment ever experienced,” he said in a research note.
The bank is forecasting 200,000 people to be out of work by the end of the year, and it would take until late 2022 before employment returned to pre-Covid levels.
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