The building industry says its ''slow crawl'' towards recovery is underway, despite building consents falling a seasonally adjusted 7.1 per cent in May.
Statistics New Zealand figures show most of the May decline came from the volatile apartment sector and that without them consents eased by a much smaller 0.4 per cent.
Economists pointed instead to a ''continued improvement'' in the underlying trend for building consents.
Compared to May 2011, there was a 20 per cent increase in the number of new dwelling consents, including apartments.
By value, consents rose 37 per cent to $532 million, the highest for a May month since 2008.
Warwick Quinn, chief executive of the Registered Master Builders Federation, agreed one had to look through the figures to see the ''lumpy'' recovery.
''They're still very low numbers but we saw a pick-up in activity towards the end of last year and we've seen a continuing trend on a month-by-month basis since the New Year."
There was ''a growing level of confidence that this year will be better than last'', he said.
This year the industry was forecasting 15,000 to 16,000 builds compared to last year's disastrous 13,500.
Economists also pointed to evidence that the rebuild in Christchurch was finally gathering steam.
Auckland had the biggest May-on-May increase, up 125 consents, but Canterbury was not far behind, up 100 consents, with the majority based outside Christchurch city.
Earthquake-related consents from Canterbury reached $47 million in May, their highest monthly level this year, although $30 million of it was for non-residential work.
Shortages of accommodation in Christchurch and price pressure in Auckland were expected to continue pushing up consent numbers this year, Infometrics economist Benje Patterson noted.
''However, the ease of securing funding remains a risk to bear in mind should international finance markets deteriorate further.''
Quinn said Canterbury's building rate was still much lower than it should be.
However, firm property prices in both Canterbury and Auckland and the emergence of first home buyers in Auckland were signs that people had renewed confidence in the housing market.
In the non-residential building sector, consents eased 0.4 per cent or $1.5m to $349m in May, compared to a year ago.
- © Fairfax NZ News