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Almost $1 billion has been spent during the past nine months on residential and commercial rebuilding in Christchurch, but the "overwhelming majority" of quake-affected property owners are waiting for work to begin.
Lead contractor Fletcher Building, which has already paid $623 million to contractors, has fully repaired 20,000 houses, but about 80,000 more await repair.
Rebuilding is estimated to cost $20 billion in total, or 10% of New Zealand's annual gross domestic product, of which the "vast bulk" is residential work worth $13 billion, Westpac chief economist Dominick Stephens said yesterday.
The estimated residential rebuilding timeframe has been extended from five to seven years while commercial work is expected to be "a decade or longer", he said.
"As the initial disruption from the earthquakes slowly fades, the repair and rebuilding phase of the recovery has gradually moved into gear," Mr Stephens said.
Insurance issues had created "headaches" for home and building owners and councils "and undoubtedly delayed progress for some", he said.
While those issues were not yet resolved, some progress on insurance payouts had been made, with Statistics New Zealand data showing almost a quarter, or $3.8 billion, of the estimated $15.7 billion of total offshore reinsurance claims had been paid by March.
Mr Stephens said EQC had paid out more than $3 billion in claims by April this year. That was more than 10% of Canterbury's GDP.
He emphasised the Canterbury rebuilding work would form the "core pillar" of the bank's forecasts on the New Zealand economy in coming years, underpinning his view of an acceleration in economic growth, emerging inflation pressures and interest rates eventually going up.
"While we are still some way off reaching the peak levels of quake rebuild activity, a start has been made," he said yesterday.
During the three quarters to June, Mr Stephens estimated more than $500 million of quake-related residential repair and rebuilding activity took place in Canterbury, while about $400 million of commercial and non-building construction was done.
"While this is a significant volume of work, it still means the overwhelming majority of quake-affected property owners are waiting for work to begin," he said.
The $500 million of residential building was just 4% of the total estimated residential repair and rebuilding activity that would need to be undertaken, and about 6% of nationwide construction activity during 2011.
Mr Stephens said Fletcher EQR, which is in charge of managing EQC repairs between $15,000 to $100,000, had completed 20,000 "full scope repairs" so far, and estimated about 100,000 homes would require an average of $30,000 be spent on each in repairs.
"This is about 20% of the total amount of work they eventually expect to complete," he said.
Fletcher EQR had reported it was processing about 350 homes per week, and expected this to eventually grow to 500 homes per week, Mr Stephens said.