Building materials are in high demand, but supply is low causing delays across the sector in Central Otago.

Central Otago building companies have faced allocation processes, imposed by suppliers trying to address the problem caused by Covid-19.

A1 Homes owner Greg Sinnot said those product shortages were beginning to pinch.

Products he was finding it hard to source were James Hardie products, soffit linings, cedar, pink batts, framing and truss timber and GIB board.

He said they were waiting around eight weeks for batts.

“For the rest of this year I expect supply to remain tight . . . we’re in a situation now where Winstone Wallboards are running an allocation system, to [try to get] panic buyers to slow down.

"It’s like toilet paper but with plasterboard."

Winstone Wallboards is operating its two factories 24 hours a day, but that had not redressed the demand issue.  

“Residential building consents are around 55,000 per year.

"That in itself would be crazy busy and full on for builders, throw Covid-19 on top of this and it is a perfect storm.

Managing Director Breen Construction Lindsay Breen said it was "an altered world" for clients and the industry. PHOTO: Supplied

“The significant government and local body infrastructure spend has added a lot of stimulus into the provinces and further driven demand.

“Today I’ve had a sub contractor unable to supply the product we need because they’ve got 17 people at home in isolation.

"You just can’t forecast for this."

He said businesses were not as resilient as they once were because they have spent a chunk of their balance sheet surviving the last two years.

Paul Piebenga, from ITM Southern Lakes, said shortages and delays were not unique to the building sector.

“Global supply constraints and international freight and Covid implications are all factors.

“Generally speaking, all core building materials are on allocation.

"So, you can get a certain volume every month based on past sales, maybe based on the past 12 months of sales."

He said there was "no silver bullet" as the situation was ever changing.

“It’s hard on people, those close to the end of a house build might be paying rent and a mortgage.

"No one in the supply chain wants to not finish their house on time.

“Our customer base understands the predicament.

"We’re all in it together and we need to communicate better.”

Latitude Homes Central Otago's Jeremy and Cat Pile. PHOTO: Supplied

Latitude Homes Central Otago director Jeremy Pile said the supply shortages were especially challenging as timeframes were changing daily.

“A product might have a four week lead time one day and then the next day it might be a three month lead time.

“We are ordering early on all our jobs.

"This means ordering plumbing, fittings and appliances to keep our jobs flowing . . . we’re trying to be as organised as we can.

“Our clients have been pretty good.

"But, it’s hard to tell someone that their house might sit there for eight weeks doing nothing waiting for GIB."

He said the situation would not ease for a long time.

“Every builder in New Zealand is affected … and it’s no good for cashflow.”

ATD Building co-owner Lomas Ainsley said supply might never return to what it was before.

“The whole year could be a year of tight supply.

"The speed of builds has slowed down and the delays vary depending on the product.”

Lomas said residential builds requiring certain roofing products or colours might take an extra few months. 

His advice to people wanting to build was to find a builder they trust and get items ordered straight away. 

Lomas said despite the supply shortage ATD Building’s second half of 2022 was looking busy with plenty of houses in the pipeline.

Barrett Homes co-owner Dee Copeland said her business was managing because they had a good number of house builds underway.

Barrett homes expects to build about 35 houses this year. 

“Enquiries have dropped off a bit as we offer fixed price contracts.

"Suppliers have had price increases and we’ve had to increase prices as well.

“There is huge demand and not enough housing, but nothing can happen quickly at the moment for anyone."

Alternatives to GIB board are available with some consumers opting for plywood or medium density fibreboard (MDF) boards, which offer a different aesthetic. 

An Australian alternative to GIB is also due to be in New Zealand soon, but shipments have been delayed due to the floods in Queensland.