House prices hit fresh high: REINZ

By NZPA

Friday 18th November 2005

House prices continued to rise in October despite the Reserve Bank's best efforts to put the brakes on the housing market.

Figures out today from the Real Estate Institute of New Zealand (REINZ) show the national median house price rose to a record $295,000 in October, from $290,000 in September and $252,500 in October last year.

The Reserve Bank governor Alan Bollard has been increasingly vocal with his concerns about the hot housing market, and last month raised the official cash rate by 25 basis points to 7%. Further rises are picked for December.

REINZ national president Howard Morley said it would become clearer next month whether last month's rise has had any impact on the market.

"Certainly higher interest rates affect lower end and new home buyers and out experience is that the more expensive the houses the lower the mortgages and the less affected owners and buyers are by interest rate increases," he said.

While prices continued to firm, sales were down. Morley said the middle and upper ends of the market were strong in October, but sales fell for cheaper property.

Sales fell in October to 8513, from 9186 the previous month.

On a regional basis, Northland's median price was unchanged at $256,150. Hawke's Bay was also static at $250,000.

Auckland rose to $380,000 from $379,000.

Waikato/Bay of Plenty/Gisborne jumped to $274,000 in October, from $265,000 in September. Manawatu/Wanganui rose to $183,550 from $175,000.

Wellington's median price rose to $304,500 from $296,500. Nelson/Marlborough increased to $273,800 from $262,250 and Canterbury/Westland edged up to $260,000 from $259,000.

On the downside Taranaki slipped to $211,000 from $225,500, Central Otago Lakes fell to $417,00 from $420,000, Otago fell to $215,000 from $220,000 and Southland fell to $119,250 from $126,500.

Comments from our readers

No comments yet