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* Controversial law: Police can now enter homes without a search warrant
* Lockdown landlord has to wait until tenants decide when they want to move out
* Latest developments and essential information

New Zealand has welcomed in level 2 this morning in style - with dozens lining up for haircuts, and roads and cafes starting to fill as commuters return to work.

Auckland hairdressers were buzzing as they returned to work on the stroke of midnight, buoyed by the sight of loyal customers queuing in the street.

More than a dozen customers were waiting patiently in line on the North Shore's Birkenhead Ave to get a fresh haircut early today - and the queues were still pumping at 3am.

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"I have been waiting a long time. I was going to get one the day they shut down," said Corbin Harkness, 17, who was at the front of the queue.

Under level 2, New Zealand is back in business. Stores, malls, cafes and restaurants can reopen from today.

Roads will be busier this morning as many Kiwis return to work, but needing to follow physical distancing and hygiene rules.

Increased traffic on SH16 at Lincoln Rd on the first morning of level 2. Photo / Michael Craig
Increased traffic on SH16 at Lincoln Rd on the first morning of level 2. Photo / Michael Craig

'Exciting day'

"It's a very exciting day," Briscoes managing director Rod Duke said today.

He expected a steady stream of customers through Briscoes and Rebel Sport stores today.
"I think they will start pretty aggressively. The first week or two will be very very busy," he told Newstalk ZB's Mike Hosking.

However, he expected some other retailers would not reopen - victims of having to close for the past seven weeks. A similar number would reopen for a while but find it too hard as the impact continued.

As well as individual retailers, our biggest malls are reopening. Kiwi Property, which owns a number of malls around the country, will reopen its centres at reduced hours in level 2 from today. There will be no late-night trading until May 28.

Kiwi Property shopping centres include Sylvia Park and LynnMall in Auckland, The Base and Centre Place in Hamilton, The Plaza in Palmerston North and Northlands in Christchurch.

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They will use people-counting systems to monitor customer-capacity limits at each centre.

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Stimulating economy 'challenging'

Former Finance Minister Steven Joyce told Hosking he expected the deficit in the Budget being announced today to be "bloody big".

He estimated debt would be 40 to 50 per cent of the country's GDP.

Joyce said what New Zealanders needed to see was a path back from that level of debt.

After the Global Financial Crisis it took a "fair while" to get debt down, Joyce said. But that was because it was both the GFC and the Canterbury earthquakes.

"Those two blew debt out to 30 per cent."

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He said the National Government was criticised for how tight it was in terms of spending, but that was what it took to get the debt down.

"It was a hard grind back."

Former Finance Minister Steven Joyce tells Mike Hosking he expected the deficit to be "bloody big". Video / Newstalk ZB

Joyce said how big the debt got would depend on what the Government chose to spend the money on but said they had to provide more support for businesses affected by the shutdown.

"I would expect to see that today."

He said those hit by a 70 or 80 per cent drop in revenue were the ones that really needed help.

"We could end up tearing up a whole lot of New Zealand's infrastructure, those small businesses, unless the support is there."

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Joyce said the Government would also need to look at what it needed to do to stimulate the economy. But that was challenging because if it just gave out cash a lot of people would probably just stick it in the bank.

"So they have to be careful there."

Stimulating the economy was challenging, he said. Spraying money everywhere was not the solution and would be something we would regret later.

"This thing is going to run a long time," he said.

He said it was about the next two years, "not the next five minutes".

Fundamentally, he said the Government couldn't know much more than the rest of us know about overseas conditions or the behaviour of people in a post-Covid environment.

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"Is everybody going to rush back into what they used to do? Probably not."

He said those questions weren't able to be answered yet.

Joyce said today's Budget would be the first chance to see the damage caused by the Covid-19 lockdown.

"It will be substantial and we all know it won't be the final answer. It's just the first stab in the dark."

Joyce said Australia expected to peak at 10 per cent unemployment and did not expect to be back at 7.5 per cent until the end of 2021.

"The same thing is going to apply in NZ."

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Bloomfield: Chances low of community transmission

Director-general of health Dr Ashley Bloomfield also spoke on the Mike Hosking Breakfast programme this morning.

Bloomfield said he was entering alert level 2 "satisfied."

He said he was satisfied with contact-tracing and testing systems put in place and, as a result, New Zealand was not uncovering any pockets of infection now.

On community transmission, he said there was now a "very low" chance of that happening.

Health officials were simply not finding traces of community transmission of coronavirus, which he acknowledged was a huge positive.

"It doesn't mean it's not out there," he said, however.

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"We're just going to have to keep an eye out there ... to see if it's still out there."

Director-General of Health and chief executive Dr Ashley Bloomfield talks to Mike Hosking about NZ entering alert level 2. Video / Newstalk ZB

Bloomfield said it was important to stay vigilant and to effectively not to drop our guard.

Asked about the funeral "fiasco" yesterday, Bloomfield said he was "really pleased" with the outcome - the 10-person limit became a 50-person limit late yesterday afternoon.

"I don't think we cocked it up so much. We went for consistency."

We can adapt, says Team New Zealand

Team New Zealand boss Grant Dalton told Hosking Covid-19 had affected preparations for the America's Cup.

"Sport is about winning and losing and being able to adapt, because of Covid-19 and the disruption it's caused, the team that can adapt and not panic is going to do the best.

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American Magic have packed everything up and a container is due to leave the US on Monday bound for Auckland. It is expected to take up to 35 days to arrive. VIDEO / American Magic

"As Kiwis we are quite good at that. Team NZ is damn good at that."

"It's changed things quite a bit, we're not unique in that respect, we lost around 7500 hours ... the industry has suffered but we've been able to offer jobs to keep things on schedule."

Queues at Hamilton's Warehouse

At Hamilton's The Base Shopping Centre, a steady queue of about 30 shoppers lined up outside The Warehouse this morning.

The centre didn't open until 9am but management were expecting a busy day as traffic management and signs were in place early.

Shirley and Bruce Alcock had lining up outside the Warehouse at 8am. They had travelled from Huntly to get some supplies - potting mix.

Also on the cards today were haircuts.

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Hamilton couple Sarah and Zac decided to brave the brisk morning and stock up on thermals.

They were looking forward to level 2, getting back to work, but anxious about the potential for crowds today.

Across at The Sharing Shed at The Base, Ngaruawahia's Vikki Barton was patiently waiting for it to open since arriving at 8am.

She arrived early, expecting a long queue, but she was the first one there.

"I knew it only opened at 8am but I was expecting a lot more people."

She was now "desperate" for a haircut after not having one for 12 weeks - she usually gets it done every four weeks.

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As for coping in lockdown, she'd been loving it.

Working two jobs and on a committee, she was enjoying having time to herself.

Hamilton man Jack was also lining up for a fresh cut.

He hadn't had a haircut in 2 months, and would usually get it sorted every 5 weeks.

He was also a regular at The Sharing Shed.

After his cut, he was looking forward to going to his favorite cafe The Lookout and having a coffee before heading to a few meetings.

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Around the country

Some cities are springing back to life sooner than others under alert level 2.

It's an almost normal day in Wellington, with heavy traffic on the motorways, lots of cars on suburban roads, and people gathering at public transport hubs.

In Auckland, traffic has been relatively free-flowing but has been picking up since 6am.

Several barbers have been serving customers through the night, and some gyms have reopened for 5am classes.

More than a dozen Aucklanders were waiting patiently in line on the North Shore's Birkenhead Avenue to get a fresh haircut early today. Video / Brett Phibbs

However, in Christchurch roads remain relatively quiet, with the only noticeable difference being the re-appearance of Lime e-scooters at popular spots.

The Canterbury Museum will be one of the first public facilities to reopen, with a limit of 100 people allowed inside at any one time.

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Kelvin Hussey arrived at Auckland's Ferry Terminal, for his first day back at work.

"I'm going out to dinner with my family after work, because it's my first day back at work. On the weekend I'm looking forward to going sailing."

Teacher Kevin Palmer was enjoying a coffee with his cycling mates, outside Auckland's Takapuna Beach Café.

"I'm back to school. I've had a lot of my students saying they don't know if they're coming back on Monday, so we'll just suck it and see I suppose."

The first people through the barber's door

In Birkenhead early today, Corbin Harkness, 17, and his brother Logan, 14, were the first to get a fresh cut from BarberShopCo at 12.01am.

"Why not get involved and do it?"

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His father Philip Harkness said they had been coming to the BarberShopCo since they first opened on the street and they wanted to support local.

Harkness said it was exciting to sneak out and do something.

He said the haircuts at the barber were always good but today's would be considered 10 out of 10, no matter what.

The first order through the till would have been $95 - Harkness paying $35 for his own haircut and $30 for each of his boys.

The first through the doors of the Birkenhead Ave store to get a haircut were teenage brothers Logan and Corbin Harkness. Photo / Brett Phibbs
The first through the doors of the Birkenhead Ave store to get a haircut were teenage brothers Logan and Corbin Harkness. Photo / Brett Phibbs

Next in the line to see the clippers were Naz Wallace, 18, and Will Morton, 17.

Morton said: "Why wouldn't you?

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"It seemed like a good idea about an hour ago - keyword 'seemed'."

He was keen to finally get his locks out of his eyes.

The company's CEO Adam Johanson said it was overwhelming to see the support.

"It's been tough, we've been working from home but for our barbers they couldn't."

It had been a "long stretch" but it was now time for rebuilding the business, he said.

Corbin Harkness, 17, pictured before his 12.01am haircut. Photo / Brett Phibbs
Corbin Harkness, 17, pictured before his 12.01am haircut. Photo / Brett Phibbs

Self-described "passionate Birkenhead local" Scott Cordes headed another queue at B & M Barbers and said he would have been happy to be there at 3am to show his support.

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No matter what, they would all be "coming out of this place looking like Elvis", he said.

He told the Herald there were plenty of barbers and hairdressers in the village.

"We are the haircut capital of New Zealand."

Kae Condon, head of the Birkenhead Village Town Centre Association, previously told the Herald security had been organised for the event - which involves three different stores - as a precaution.

If there was a large turnout they might want help to ensure rules about physical distancing were being followed, she said.

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"Its just a precautionary thing because we all need to make sure we are going forward not backward."

Earlybird customers had their choice of BarberShopCo, Bob the Barber and B & M Barbers as the three stores opened in unison.

Hairdressers had donned appropriate protective equipment and were minimising contact as much as possible.

But it prompted plenty of smiles behind the masks.

"The boys have said we will cut until there are no more customers," Condon said.

They had expected a peak in interest around midnight, she said.

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"I'd be very surprised if there were people around at 3 in the morning but you just don't know how badly people might want a haircut.

"There's a lot of wild and woolly men out there."

If the barbers run out of customers they would take a break before reopening at 6am, she said.

Condon wanted to thank the supporters who were coming out.

"We love them," she said.

"We still want to be here to serve the community in another 10 years and they are making it possible by voting with their feet."

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Covid19.govt.nz: The Government's official Covid-19 advisory website