Message from the Chief Executive

Working through the COVID-19 pandemic

Our country continues to remain in a state of relative uncertainty due to the COVID-19 pandemic and there are sectors of our community that regrettably have been severely impacted. There are, however, some sectors who to date have either continued in a normal manner or in some cases flourished.

We can be very thankful so far that the building and construction sector has continued with some vigour, especially so in the residential (new homes and alterations) part of the sector. This has been constantly confirmed from surveys New Zealand Certified Builders (NZCB) have undertaken with our members, and feedback tells us that pipelines and current workloads are pretty secure. Based on the last survey by NZCB in early September, over 72% of respondents had in excess of 6 months’ work ahead of them and it was not uncommon to receive reports of members having up to 12–18 months confirmed work ahead of them. Long may it continue.

It appears this demand is being driven by an accumulation of low interest rates, the redirection of overseas travel funds and strong existing house prices. The latter has, I believe, encouraged homeowners to redirect equity investments/bank deposits toward housing or, in some cases, take on additional debt at the low interest rates impacting on reduced debt servicing levels.

On the negative side however, there are signs of falling consumer confidence, the uncertainty on continuing immigration and rising unemployment levels. So, it is reasonable to say that we do have some headwinds ahead of us regarding future demand levels.

One of the wise comments made during times of economic uncertainty has been...

“now is not the time to reduce your marketing or advertising spend.”

In fact, companies should be considering increasing this spend.

From a builder’s perspective future work pipelines are full, existing customers are seeking completions and furthermore many potential homeowners are knocking on their door asking for potential start times. It would then seem very prudent to be allocating time in their very busy days to address those queries and take action to lock those future jobs in. There are comments that homeowners will not wait for extended start times, however when the industry as whole is providing longer lead times or, worse still, not responding to enquiries, I am sure you will find potential customers will be more resilient to long lead in times. After all, this provides them with some certainty. Give it a try and you may be pleasantly surprised.

Halo 10-Year Residential Guarantee In this issue of InHouse there are several articles about NZCB introducing the new Halo 10-Year Residential Guarantee product to our members. Since January 2020, it has been an intense time continuing to try and secure alternative underwriters and then subsequently having the NZCB Board approve the introduction of the new Halo 10-Year Residential Guarantee.

Since June, we have worked tirelessly on the development of the Governance structure, legal terms, administration processes, application form development, both member and homeowner handbooks and technology development. There is still some work to do behind the scenes but through the commitment of my Senior Management Team and our external partners we have produced a product that is fit for purpose. I appreciate the patience many of our members have displayed as we have made these decisions and developed this new product and I appreciate it has not been easy for any of us.

Over the next few months, I am excited to continue working on the development of the new Halo product and this will follow the path we undertook with the Halo insurance product which we improved and developed over time from when we introduced it in December 2015 to when it was unfortunately suspended.

I look forward to working with you all on the development of the new Halo 10-Year Residential Guarantee over the coming months.

‘Till next time…