New Zealand's largest construction company says a 4.3% contraction in the building sector in the June quarter reflects the lack of construction over the past year in earthquake-hit Canterbury.
New figures released on Thursday show the New Zealand economy sharply contracted during the three months to June - due in part to a downturn in building. Official figures show gross domestic product rose 0.1% in the three months to June.
Philip King, Fletcher Building's general manager investor relations, says another reason for the malaise in the sector is the low number of building consents being sought; in some regions they are at record low levels.
Mr King says there are many reasons for this, including a huge number of finance companies who were major lenders to property developers going bust, low consumer confidence which has affected interest in rental properties as investments, and banks toughening lending criteria for new home building.