Building consents for houses and apartments have rebounded, but growth is easing due to fewer permits for apartments in Auckland.
Official figures show housing consents rose a seasonally adjusted 6.6 percent in April, following a sharp fall in the previous month.
Statistics New Zealand says while levels are higher than a year ago, growth has eased in recent months.
"The easing trend for new dwellings has been caused by a lull in apartment consents, especially in Auckland," Statistics New Zealand business indicators senior manager Neil Kelly said.
"However, apartment numbers tend to be quite volatile. For stand-alone houses, the trend is still increasing."
On an annual basis, consents hit an 11 year high, to more than 28,000, compared with 25,000 in the previous year.
Most of the growth has been in Auckland and surrounding regions, while Canterbury fell.
Apartments remained relatively unchanged over the past year, following strong increases during the previous three years.
Houses, townhouses, and retirement village units continued to increase.
ASB Bank chief economist Nick Tuffley estimates Auckland is short about 25,000 houses.
He expects the recent lull in apartment consents will end soon.
"We certainly think that the Auckland drivers are going to demand more construction over time. Probably where the question marks come in is whether or not there is the capacity in the industry to do it," said Mr Tuffley.
"We certainly know there's going to be a lot of leaning on the [Auckland] Council to make sure there is more land made available."