House values stable though recovery signs 'short lived'

Tuesday 12th April 2011

New QV figures show national residential property values remained relatively stable in March, while signs of increasing activity were noted in Auckland and Wellington.

QV indices for March were 2% lower than the same time last year, and 5.9% below the market peak of late 2007. In February values were 5.6% below the peak, and in January they were 5.8% below.

QV research director Jonno Ingerson said that during the past year nationwide values declined gradually through until December before becoming a little more variable in the months following.

A levelling of national values in the past few months had been largely driven by a slight recovery in values in Auckland and Wellington, offsetting continued declines in provincial and rural areas, Ingerson said.

"These first signs of a possible recovery in values were short lived as both Auckland and Wellington slid back again in March."

Activity lifted in March, particularly in Auckland and Wellington, after a quiet start to the year.

"First home buyers are back looking in the more affordable areas perhaps buoyed by lower interest rates," he said.

"However many buyers remain non-committal, knowing that there is limited competition and that values are not expected to rise significantly in the short term. Good quality properties continue to attract interest and sell at the value expected."

In Christchurch, interest was strong for well-priced quality homes in suburbs unaffected by the February earthquake.

That was also the case in Waimakariri and Selwyn townships, along with an increase in demand for vacant sections. The pattern had been similar after the September earthquake.

"There remains a great deal of uncertainty in the market and we expect that to continue for some time while decisions about the nature of the rebuild in Christchurch are made," Ingerson.

The average New Zealand sales price over the last three months - a less reliable measure of value change - was $400,656 down from the $411,712 reported last month.

Compared to this time last year Whangarei values were down 6.2%, Rotorua was down 4.2%, Gisborne down 6%, Hastings and Napier both down 1.5%, New Plymouth down 3.7%, Wanganui down 3.6% and Palmerston North down 4%.

Nelson, with one of the strongest markets, was level with last year, while Queenstown Lakes was down 1.7% below and Invercargill was down 3.4%.

NZPA

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