The volume and value of building work in place for the quarter to March has declined, rubbing against the grain of economists' expectations.
Overall, building work put in place for the quarter was down 3.5%.
This was ''weaker than expected'' by ASB senior economist Jane Turner and below market forecasts for Westpac senior economist Satish Ranchhod.
Ms Turner said the fall in building activity was unexpected, but she predicted it would be temporary.
''The level of consents remains firm on a trend basis.
''With demand at extremely high levels, construction-cost inflation will continue to accelerate,'' she said.
Construction activity declined most in Auckland, which Ms Turner believed would be temporary, but Christchurch's decline in building activity was expected to continue as rebuilding was gradually completed, Mrs Turner said.
Statistics New Zealand senior manager Jason Attewell said the volatile non-residential building work series led the volume fall, decreasing a seasonally adjusted 7.2%, while residential building work decreased 0.8%.
''Building work has been at historically high levels since late 2015.
''[However] building activity adjusted for price changes fell for the first time in two years, due to a decrease in commercial and other non-residential building work this quarter,'' Mr Attewell said
Westpac's Mr Ranchhod said while market forecasts had been for a 0.3% gain, the overall 3.5% decline was below his expectations of a ''flat'' result.
''This follows gains in previous quarter, and leaves the level of construction activity up 4.3% over the past year,'' he said.
The main reason for the weakness in the first-quarter activity was the 7.2% decline in the non-residential construction activity.
''Underlying this was a sharp pull-back in commercial building centred in Auckland.
''Spending on public projects was firmer,'' Mr Ranchhod said.
As with Ms Turner, Mr Ranchhod also expected the Auckland downturn to be temporary.
He said there was ''a large pipeline of work planned'', much of it centred in Auckland, with decade of building required to address the housing shortfall and to keep up with ''the surging population growth''.
Otago is not scrutinised in the SNZ data, but Mr Ranchhod said he expected ''strong increases'' in residential building around Otago, Nelson, the Manawatu and Northland.
