Building confidence
Nathan Miglani of Squirrel South Island says the local construction sector is on track.
Construction activity across Christchurch and the wider South Island is clearly gaining momentum again. We are seeing sections move with intent, and developments starting to come through at a steady pace. New builds are leading that growth, with strong demand for quality housing driving activity across multiple segments. At the same time, there is a noticeable shift towards renovations. Many homeowners are choosing to improve what they already have, particularly in established areas, supported by more attractive lending options now available through the banks.
What is also becoming increasingly clear is the level of interest coming from outside the region. We are working with a number of Auckland-based investors who are actively looking at well-located, high-quality developments in the South Island. The combination of relative value, decent yields and long-term fundamentals is difficult to ignore. This demand is supporting a wide range of projects, from townhouses through to standalone homes and commercial developments.
Of course, the environment is not without its challenges. Cost pressures remain, particularly around fuel and transport, which are flowing through into build costs and contract pricing. Alongside ongoing global uncertainty, it has become more difficult to lock in absolute cost certainty over longer build timeframes. That said, with the right expectations and a well- structured finance strategy, these risks can be managed effectively.
We are also seeing strong growth outside Christchurch. Central Otago, and Cromwell in particular, continues to stand out. Several of our clients are establishing a presence there to support the wider Queenstown and Wa¯naka regions. With significant residential growth planned, Cromwell is positioning itself as a key regional hub over the coming years.
In a market like this, building well is only one part of the equation. How a project is funded plays a critical role in cash flow, risk management and long-term flexibility. Getting the structure right from the outset allows you to move forward with confidence, even when conditions are shifting. This is where my team and I spend a lot of our time. We enjoy working closely with clients in the construction and development space, helping them put the right lending structures in place so they can make clear, informed decisions and take advantage of the opportunities in front of them.
Construction in 2026 continues to present real opportunities and with the right approach, they are there to be taken.
