NZ house price growth slowed to 0.1% in June, QV says

Monday 14th July 2008

New Zealand house price growth almost stalled in June and may weaken further as consumers contend with high prices for food, fuel and loans, according to Quotable Value.

House prices rose just 0.1% in June from a year earlier, the weakest since the survey began in 2005, slowing from a 2.4% pace in May, according to the government valuation agency.

The figures follow a Real Estate Institute survey on Friday showing June home sales fell 1.5% from May and almost halved from the same month of 2007. A slump in the property market and dwindling consumer confidence has helped stoke expectations the central bank will cut interest rates, probably in September.

"With market activity slowing dramatically, consumer confidence knocked by increasing interest rates, fuel and food prices, we expect the trend of falling property values to continue," QV said.

House prices in Auckland dropped 2.4% from a year earlier.

By Jonathan Underhill

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