Nelson economy booms while Auckland slides

Cloudy Bay winery, (the Richmond Ranges/Nelson region ). Supplied pic.

Nelson continues to top ASB's regional economic scorecard thanks to booming tourism, horticulture and viticulture sectors but Auckland is sliding as it hits capacity constraints in construction.

Northland's economy has had a surprising lift in activity after falling for the past two quarters.

ASB's 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.

Nelson's second-straight quarter at the top was a result of booming tourism, horticulture, viticulture and construction, said ASB chief economist Nick Tuffley.

This, combined with high consumer confidence, painted a positive picture for the region in the year ahead.

Northland jumped up seven spots to second place for overall economic growth as the region continues to benefit from the national tourism boom.

Tuffley noted that while confidence remained lower in Northland its labour market was clearly improving, he said.

Auckland was suffering growing pains, he said.

It dropped one place in the regional rankings because even though activity remained high the rate of growth was slipping.

Housing was the best example of this, Tuffley said.

"Auckland residential building consents are down on a year ago but not because the demand for homes isn't there. There are simply too many impediments in the way."

Canterbury was bottom of the scoreboard this quarter.

Activity remained high in the region but the slowdown is across a broad range of growth indicators as the rebuild continues, including tourism.

"The decline in guest nights remains a thorn in Canterbury's side and is the weakest region in the country for this measure of activity," Tuffley said.

However, dairy income is expected to boost activity in rural Canterbury into 2018.

The dairy price revival was already starting to boost growth and was already starting to help in some regions.

Manawatu-Whanganui was this quarter's biggest mover, up nine places on the scoreboard to fourth place, from 13th.

"The recovery in dairy incomes, paired with a fair outlook for other primary producers, has been positive for Manawatu-Whanganui," Tuffley said.