Thursday 5th April 2018
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New Zealand residential property values continued to rise in the year to March, but while there was a seasonal pickup in activity, sales volumes were lower than usual as the market continues to show signs of easing.
The average value of a New Zealand home rose 7.3 percent to $677,618 in the year to March, data from state-owned valuer Quotable Value showed.
Record migration and low-interest rates have been bolstering the country's housing market, prompting Reserve Bank restrictions on more highly-leveraged mortgage lending in a bid to quell a possible bubble. That, coupled with new government policies to restrict the sale of homes and property to foreign investors, has dampened enthusiasm.
"Residential property value growth remains subdued compared to recent years but March has seen the usual seasonal pick-up in sales volumes and activity," said QV’s national spokeswoman Andrea Rush. “This has seen nationwide annual value growth rise to 7.3 percent, which is the fastest rate in nine months but sales volumes are still lower than usual for March," she said.
Auckland residential property values continued to lag the behind the country as a whole but the market remains stable with any value changes relatively small, QV said. Residential property value growth across the Auckland region increased by 1 percent on the year and the average value for the Auckland Region is now $1,055,992.
“We are still seeing the trend of well-presented and located properties continuing to sell well but homes with any issues, outstanding maintenance or that may lack sun, are not selling easily and tending to sit around on the market for longer. In general, properties are taking longer to sell," said QV Auckland senior consultant, James Steele.
Outside of Auckland, Hamilton city home values rose increased 4.3 percent in the year to March and the average value in Hamilton is now $555,549. In Tauranga, home values rose 4.5 percent year on year and the average value in the city is $706,922.
In the Wellington region, values rose 8.2 percent in the year to March and the average value is now $644,567. “There is still plenty of activity in the Wellington market though value growth continues to slow and it feels like we are starting to enter a period of stable property values after a couple of years of strong growth," said QV Wellington senior consultant, David Cornford.
He noted there is still strong demand for property under the $700,000 mark and in particular for anything under $500,000 as first home buyers are a strong presence in the market in suburbs such as Porirua and the Hutt Valley.
In other urban centres, Christchurch was largely unchanged, easing 0.6 percent year-on-year with an average value of $494,117. “The Christchurch market is still slow and steady and that’s what we expect to see now for the medium to long term," said QV Christchurch Property Consultant Hamish Collins.
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