Latest building consent figures show the number of residential dwellings being planned rose sharply in February.
Residential consents were up by 5.8 per cent on January (or 5.9 per cent when apartments were excluded). That compares with a rise of 3.7 per cent in January and falls inOctober, November and December.
The rebound in February has divided economists, some of whom see it as a sign that building activity is picking up again - something that would provide Reserve Bank Governor Alan Bollard with an incentive to raise interest rates again next month.
"It's not necessarily a surprise, but it's not good news either," said Darren Gibbs, chief economist at Deutsche Bank. "It's probably the bad news that the bank expects to see."
When you combined the rebound in January and February with other indicators such as the latest data on house sales and the residential construction intentions index in the NBNZ business survey, Gibbs said, it was starting to look as if the issuing of residential consents would continue to rise over the next three or four months.
"If the pick-up we've seen over the next couple of months is sustained, then we might find we weren't in a downtrend at all."
But other economists were not convinced the trend was shifting.
It was premature to say that the consents were in an upswing, said UBS economist Robin Clements.
"The February bounce was a strong number," he said. "But it hasn't altered the trend, which is still declining."
A trend line from August last year still shows an overall decline in residential consents and on a seasonally adjusted basis the total number of residential consents for the month is down when compared with every February since 2004.
"The Reserve Bank is looking for moderation in housing," Clements said. "This is one of the elements of housing and the trend has been declining since August, so by definition that is a moderation."
An ANZ review of the data also notes that the number of residential consents is below the average for 2005 and 2006. It says overall consents - including non-residential - were still in decline and that news would be welcomed by the Reserve Bank.
