NZ building activity picks up as Canterbury rebuild begins

Building activity picked up in the last quarter of 2011, says Statistics NZ, as the Christchurch rebuild finally starts. File photo / Northern Advocate

New Zealand building activity picked up in the final three months of 2011 as construction in Canterbury began to emerge, with the region's rebuild looming as a major economic stimulus.

The value of building work put in place rose a seasonally adjusted 2.9 per cent to $1.7 billion in the three months ended December 31, bouncing back from a decade-low in the previous quarter, according to Statistics New Zealand. Residential work climbed 4.4 per cent and non-residential activity was up 1.4 per cent.

"In Canterbury, there appeared to be a greater increase in building activity than in the rest of New Zealand," industry and labour statistics manager Blair Cardno said in a statement. "This was true for both residential and non-residential building."

The bill for the Canterbury rebuild is estimated to run beyond $20 billion, and is seen as the likely foundation for New Zealand's economic recovery. Still, ongoing seismic activity in the region has delayed work as insurers remain nervous about covering new work, deferring activity and sapping earnings for construction companies, such as Fletcher Building.

Today's figures come after January building consents showed an improvement in intentions, mainly off the back of permits to build retirement units in Canterbury.

On an annual basis, the value of all building work put in place dropped 10 per cent to $9.93 billion, with a smaller contribution from residential housing than in 2010.

The value of residential building put in place fell 14 per cent to $5.39 billion in 2011, led by a 16 per cent slide in new dwellings. Non-residential activity dropped an annual 5.7 per cent to $4.54 billion last year, with big declines in construction of accommodation buildings, hospitals and nursing homes and miscellaneous buildings.