NZ property values continue march higher in February

Wednesday 1st March 2017

New Zealand property values continued to rise at an unchanged annual pace in February as buyers sought out new areas of growth with some of the usual suspects cooling off in the month.

The average value of a New Zealand home rose 13.5 percent to $631,349 in February from a year earlier, with values up 1.1 percent on a rolling three-month basis, state-owned valuer Quotable Value said. That growth has been centred in Auckland in recent years as the country's largest city faces a shortage of housing to meet a growing population, though lending curbs have helped slow growth, with values shrinking 0.7 percent over the past three months to $1.04 million, an annual gain of 12.8 percent.

"The latest QV house price index figures show values have dropped over the past quarter in parts of Auckland, Hamilton and Christchurch and rate of value growth in Tauranga has also slowed as the latest round of LVR (loan-to-value ratio) restrictions continue to take effect," QV national spokeswoman Andrea Rush said in a statement. "It's possible the latest quarterly decrease seen in parts of Auckland will be relatively short-lived as the market drivers of relatively low interest rates, strong net migration and a high number of sales to investors remain."

Real Estate Institute figures last month showed house sale prices were holding up, although the level of turnover was down 15 percent, and Fith Ratings expects the local property market is in for a "pronounced and overdue slowdown" where house price inflation falls to 5 percent.

QV said there was still uncertainty about the Auckland market with a flood of listings last month, and resurgent interest from investors who have faced specific lending restrictions.

Hamilton became a popular place for investors facing Auckland-specific curbs, and while property values rose 16.7 percent to $532,171 in February from a year earlier, they were down 0.8 percent on a rolling-three-month basis. Tauranga was another beneficiary to the Auckland halo-effect, and property values in the Bay of Plenty city rose 1.3 percent over three months to 673,923, for an annual increase of 19.4 percent.

Wellington property values were up 21.5 percent on the year to $589,784, a gain of 4.3 percent over a three-month period, as the capital city continued to experience a revived housing market. Dunedin is another city with a reinvigorated market, with property values up 15.6 percent to $359,629 on an annual basis.

Christchurch property values rose an annual 2.8 percent to $498,710 and were down 0.5 percent on a three-month basis after the housing market settled down once the earthquake residential rebuild effort passed its peak.

BusinessDesk.co.nz

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