
Earthquake monitoring agency GeoNet reported the aftershock struck at 1.34pm at a depth of 35 kilometres, in a similar area to the first tremor.
Prime Minister John Key who was flying over affected areas on the east coast of the South Island said it was a scene of utter devastation which would take months to fix and cost hundreds of millions of dollars.
The 7.5 quake which struck overnight killed two people. A man died when his house collapsed like a stack of cards during the earthquake.
Two other people were later pulled alive from the wreckage by fire fighters.
The other victim is believed to have died of medical complications in rural Mt Lyford, north of Christchurch.
The initial quake struck just after midnight local time at a depth of 15 kilometres and reached 100 kilometres off the east coast of the South Island, raising fears that it could generate a tsunami.
The tsunami warning has since been lifted.
The east coast of the South Island was worst affected by the midnight quake, with a massive landslide taking out a coastal portion of the state highway near the whale-watching town of Kaikoura.
The New Zealand Defence Force which is using an Orion surveillance aircraft to survey the roads running down the east coast of the South Island has posted photos of the damage online.
The images show massive rock falls have taken out sections of the coastal road and the adjacent railway line - in one case completely skewing the railway tracks on to the rocky shore.
Several towns close to the epicentre, including Kaikoura and Waiau in North Canterbury, have been cut off by landslides and large fissures in the roads.
On Monday afternoon, Civil Defence was urging residents in areas near the Clarence River to move to higher ground immediately after a damformed by a landslide breached, causing a large wall of water to head downstream.
The earthquake caused major damage not just to infrastructure but also to people's homes.
One resident, Bella Swarbrick, who lives near Waiau told Radio New Zealand that items in her house had been badly damaged by the quake.
"Just broken everything, everywhere, just everything off the shelf.
The microwave in the kitchen shot out of the shelf.
"Others posted photos of the damage to their houses on Twitter, showing ceiling panels falling in and brick chimneys collapsing, using New Zealand's earthquake hashtag #eqnz.
Inter-island ferry services between the North and South Islands were cancelled, while the terminals were assessed for damage, Kiwi Rail said.
The quake caused widespread damage as far north as the capital Wellington, where the city council asked people not to travel into the city centre on Monday because of danger from broken glass.
Prime Minister Key posted a video online showing damage to his offices, saying it was a bit of a mess.
"A lot of broken crockery, glasses and the likes but we'll make sure we put all that back together and we'll work hard to make sure communities are put back together.
"Key described it as a "terrifying night" for a lot of New Zealanders and said it would likely be some time before there could be a full assessment of the quake damage.
"As we have daylight we can use the military assets that we have to make sure we get a stock-take of the overall damage but I suspect that will take quite some time to fully understand.
"In 2011, a 6.3 earthquake hit Christchurch, killing 185 people and causing major damage.