With 75 people already confirmed dead following the 6.3 earthquake in Christchurch, Prime Minister John Key says people need to prepare for that death toll to climb.
Early on Wednesday, Key said 55 bodies had so far been identified around the city and 20 remain unidentified since Tuesday's devastating quake.
"We know there are a number of sites that are likely to have suffered other fatalities," Key told ONE News last night.
"It is a very tragic situation and it's a time of great agony."
The fire service said there are seven buildings confirmed with people trapped inside. Those buildings are the CTV building, PGC building, Christchurch Cathedral, The Press building, Smith City carpark, St Asaph/Colombo, and 92-95 Cashel Street.
Police abandoned their rescue efforts at CTV yesterday, saying they did not believe the site of the building was survivable.
With search and rescue teams pulled back, firefighters are now moving into the building to try and put out a large fire in the basement.
Civil Defence said today diggers are also being used to remove large amounts of rubble.
Fears for hotel
Meanwhile, there are fears that one of Christchurch's major hotels is also on the verge of collapse.
Emergency services have pulled back from the Hotel Grand Chancellor, one of the tallest buildings in the CBD for safety reasons.
It is significantly structurally damaged.
"If the Hotel Grand Chancellor falls, and three engineers say it is a significant risk, that will be dramatic, a domino effect in the central city of other unstable buildings. It will be a major disaster," said police Superintendent Dave Cliff.
A large number of cordons remain in place in central Christchurch to prevent access into the restricted central city high risk area.
Police said entry within the cordon area is strictly prohibited. The only exceptions are residents and legitimate workers who must produce identification.
Parts of Sumner evacuated
Houses on Kinsey Terrace and the Clifton Hill areas of Sumner were evacuated last night as a precaution after cracks were noticed on a nearby hillside. Engineers are checking the area.
Residents are being told to stay with friends or family, or go to welfare centres.
Key declared a national emergency when he addressed media at about 11.00am after meeting with Cabinet.
He said he had enormous faith in the leadership in Christchurch but a national emergency would give more control to central government.
Key said that in practice "this enables the strongest possible focus of local, national and international resources working together to achieve the best possible response in the shortest timeframe".
He said there were no other differences between the powers under the existing state of local emergency and a national state of emergency.
Those powers would be exercised working in close support of and in cooperation with Mayor Parker, and the Christchurch Civil Defence team.
Key said he had been in contact with Parker to inform him of the decision.
He told residents in Christchurch that New Zealanders feel "your pain as only a small nation can".
"We are witnessing the havoc caused by a violent and ruthless act of nature. Many people have lost their lives. Families have lost their cherished loved ones. Mates have lost their mates.
"These deaths are the greatest loss."
Key said he was a "proud son of Christchurch".
"I was raised there, I got my first job there, my sister lives there, my mother died there, I know what a wonderful place it is. But my connection to Christchurch is no rare thing.
"All New Zealanders have a piece of our heart in Christchurch. All of our lives are touched by this event," he said.
Key is calling for people to rally around those who are grieving, offering both tangible and emotional assistance and says no act of kindness is too small.
"Things will get better. Christchurch will rise again," he said.
"There is no reason that can make sense of this event, no words that can spare our pain."
Focus on victims still alive
Meanwhile, rescue workers said some survivors have been pulled out with barely a scratch while others have had to have limbs amputated to get them out.
Police Superintendent Russell Gibson told ONE News on Wednesday morning that bodies were littering the streets and that many people were still unaccounted for.
However he said the focus was on saving the people who are still alive, trapped under rubble.
"We are finding bodies all through the city and we are having to leave those, as our focus is on the people who are still alive," he said.
He said police were in communication with some victims, through text messages and knocks and cries from collapsed buildings and that all agencies involved were working as hard as possible.
Gibson said it was a difficult to speculate on the total death toll, as it was a "rapidly evolving situation".
"We know it will be significant and we know there are a lot of people going through the nightmare ordeal of waiting for news of their loved ones," he said.
Australian death confirmed
An Australian has been confirmed as one of those killed in the quake.
Australian Prime Minister Julia Gillard confirmed the death yesterday, saying they were still working through details.
The man was assisted by a passer-by in the last hours of his life, Gillard said.
"Our thanks would go to that stranger and I think that's an emblem of the kind of spirit that we see in Christchurch as people get together to help each other."
More search teams arrive
Australian search and rescue teams have arrived in Christchurch.
Forty search and rescue specialists from New South Wales arrived on Tuesday night to help the rescue effort. Another 30, bringing specialist equipment, were due in the city yesterday.
Civil Defence's John Hamilton said they were working with the government to consider offers of other international assistance.
New Zealand had accepted help from Britain, Singapore, Japan and Taiwan.
A specialist Disaster Assistance Response Team from the United States is also heading to Christchurch.
The US Agency for International Development (USAID) Dart team, is made up of more than 70 specialists, including members of the Los Angeles County Fire Department urban search and rescue team.
The team will also bring "all necessary equipment to make live rescues in even the most precarious situations".