Consumer confidence has rebounded after falling to its lowest point in more than a decade.
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The McDermott Miller Consumer Confidence Survey by Westpac for the December quarter shows sentiment rose nearly 11 points to 106, the highest level this year. It had slumped to its worst reading since 2008 in September.
Respondents view of their own current financial situation was slightly less pessimistic, up nearly three points to a net - 14 percent.
"After a tough year, many New Zealand households are dialling up their spending on activities like dining out and other leisure activities. That bodes well for domestic tourism over the summer holiday period, especially as overseas trips are still off the card," Westpac senior economist Satish Ranchhod said.
He said positive vaccine news and the resurgence in the housing market had also boosted households' appetite to spend.
"New Zealanders hold a lot of their wealth in housing assets, be that the family home or some form of investment property.
"Consequently, recent price increases are likely to have left many households feeling more optimistic about how their personal financial position is shaping up."
Ranchhod said not all households were homeowners and entry into the market remained a big concern for a lot of families.
"That may be one reason why, even though confidence is up among all groups, the rise is most pronounced among those households on higher incomes who are more likely to be homeowners."
Consumer confidence picked up across every region, with Gisborne and the Hawke's Bay recording the most optimistic, with Otago, which includes tourist hotspot Queenstown, still marginally pessimistic.
People aged 18 to 29 remained the most downbeat age group, reporting that their financial position had deteriorated over the past year.
This group was also the least optimistic that their finances would improve in the new year.
The survey showed a discrepancy between households spending intentions and their actions.
Ranchhod said this was because younger people tended to be employed in hospitality, which struggled through the pandemic, and were less likely to own a house.
"Over the past few months, we've seen households spending up on furnishings and other household items.
"However, when we asked about their spending plans the number of households who thought it's a good time to make a major purchase actually remained quite low in December."