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Nelson knocks Otago from top spot as NZ's best performing region

Contributor:
Fuseworks Media
Fuseworks Media

Nelson has knocked Otago from top spot as New Zealand’s best-performing region in the latest ASB/Main Report Regional Economic Scoreboard.

The December 2016-quarter report reveals Nelson has risen from second place and is "firing on all cylinders" with booming horticulture, viticulture, tourism and construction.

Meanwhile, the Kaikoura earthquake has had an impact on Wellington and Marlborough as each drop six spots in the rankings this quarter.

ASB Chief Economist Nick Tuffley says this is likely to be a temporary drop, particularly for Wellington.

"Wellington and Marlborough have certainly felt the effects of the November earthquakes as local activity slowed, unsurprisingly, over the quarter," Mr Tuffley says.

"The earthquakes will continue to affect Marlborough in the short-term, although repair work will lead to acceleration in activity in the medium-term."

The Tasman region has jumped four spots in the rankings this quarter to second place.

"Just as Nelson retailers have benefitted from the tourist dollar, so too, has Tasman. We wouldn’t be surprised to see Tasman make a run for the top spot across 2017," Mr Tuffley says.

The Waikato and the West Coast are the biggest movers this quarter, each jumping seven spots to third and fifth place, respectively.

"Waikato consumers are among the most optimistic in the country, and, with much improvement in farm cashflows to come, we may see further growth ahead," Mr Tuffley says.

The West Coast topped the national chart for retail sales growth which is encouraging for the region, Mr Tuffley says.

"It seems tourism is also working its magic on the West Coast as guest nights continue to strengthen," Mr Tuffley says.

Construction, construction, construction

Construction continues to be one of the biggest drivers of economic activity across the country.

Auckland’s construction market remains hot with more than 60 cranes dominating the skyline. However, Mr Tuffley cautions Auckland is suffering from growing pains.

"In many cases construction can’t happen fast enough in the big smoke. The recent slowdown in building consent numbers teamed with record migration means the housing shortage will get worse before it gets better."

Otago’s reign at the top of the Scoreboard was short-lived last quarter, not because the region has slowed but because it simply can’t grow at the rates it has been, Mr Tuffley says.

"Construction remains healthy in Otago, with the value of residential permits up strongly on a year ago. However, lending restrictions are impacting the housing market and these may well continue to be a damper on residential activity in coming quarters," Mr Tuffley says.

ASB/Main Report Regional Economic Scoreboard Q4 2016

1 Nelson

Up 1

2 Tasman

Up 4

3 Waikato

Up 7

4 Gisborne

Up 3

5 West Coast

Up 7

6 Hawke's Bay

Down 3

7 Otago

Down 6

8 Bay of Plenty

Down 1

9 Northland

Down 2

10 Wellington

Down 6

11 Marlborough

Down 6

12 Auckland

Down 1

13 Manawatu-Whanganui

Up 1

14 Taranaki

Down 1

15 Canterbury

Up 1

16 Southland

Down 1

About the ASB/Main Report Regional Economic Scoreboard

The ASB/Main Report Regional Economic Scoreboard takes the latest quarterly regional economic statistics and ranks the performance of New Zealand’s 16 regional council areas. The fastest-growing regions gain the highest ratings and a good performance by the national economy raises ratings across the board. Ratings are based on measures such as employment, construction, retail trade and house prices.

The full report is attached and available online at www.asb.co.nz

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