Consumer confidence is at a three-year high, according to a Westpac Bank bank survey.
But spending is expected to show solid growth rather than taking off, with new rules making it harder for home-buyers to get a loan with a low deposit, and the prospect of rising interest rates next year potentially causing concern.
The Westpac McDermott Miller Consumer Confidence Index rose to 120.1 in December, from 115.4 in the September survey.
That was its highest since September 2009, when it was 120.3, and before that in September 2005, when it was 120.2.
"If any more evidence was needed that the New Zealand economy is picking up, this is it," said Westpac chief economist Dominick Stephens.
An index number over 100 indicates optimists outnumber pessimists.
"Households haven't been this positive about their own finances, or this optimistic for the wider economy, in many years," he said.
With the construction sector ramping up, job numbers on the rise, house and share prices soaring, and dairy prices sky-high, "we would have been surprised to see otherwise".
But by contrast, households' attitudes to spending have held steady.
"On balance, that suggests consumer spending should see solid growth, but won't go bolting away," Stephens said, with the housing market keeping the appetite to spend in check.
"Along with recent restrictions on low-deposit lending, rising house prices have raised the financial bar to home ownership. And for existing homeowners, the likelihood that interest rates will rise next year may have caused concern."
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