May 29 (Bloomberg) -- New Zealand’s home-building approvals rose in April for the second time in three months, a sign that lower mortgage rates may kick-start demand for property.

Permits climbed 11.2 percent from March, when they fell a revised 1.7 percent, Statistics New Zealand said in Wellington today, citing seasonally adjusted figures. Excluding apartments, building permits gained 4.5 percent.

An increase in approvals, combined with figures this week that showed business confidence picked up in May, add to evidence the economy may begin to recover from its deepest recession in more than three decades. Reserve Bank Governor Alan Bollard last month cut rates to a record-low 2.5 percent and said borrowing costs may stay at or below that level until 2010.

Lower interest rates “are providing support to the housing market,” said Khoon Goh, senior economist at ANZ National Bank Ltd. in Wellington. “The bottom in terms of building consents has been found. Overall levels are still depressingly low.”

Even as the number of home-building approvals has climbed from January’s record low, the underlying trend is at its lowest since the series started in January 1992, the statistics bureau said. Approvals in April fell 58 percent from a year earlier, according to unadjusted figures in the report.

The value of approvals for home building and renovations plunged 45 percent from a year earlier.

The value of non-residential building approvals rose 11 percent to NZ$530 million ($330 million), the highest since 1965, stoked by an expansion at Christchurch International Airport, Statistics New Zealand said.

To contact the reporter on this story: Gavin Evans in Wellington at gavinevans@bloomberg.net.

Last Updated: May 28, 2009 19:13 EDT