Nationwide prices up but provinces see falls: QV

Tuesday 14 February 2012

Nationwide residential property values have continued to rise with Auckland leading the charge, according to the latest QV monthly index.

Values across the country rose 1.1% over the past three months and are now 2.7% above the same time last year but remain 3.3% below the market peak of late 2007.

"While national values are continuing to increase, this is not universal across the country," said QV research director Jonno Ingerson.

"While the combined main urban centres and combined rural areas have increased over the past few months, the combined provincial centres have begun to slide back again."

Ingerson said market activity had picked up since the New Year, with signs that decisions made over the holiday period were translating into action.

"However, potential buyers remain cautious and calculated and are often unwilling to commit quickly."

Ingerson cited the lack of housing supply - especially in central Auckland - for the increase in values in many parts of the country, saying when quality properties did appear on the market the high demand was helping push prices up.

Unsurprisingly, Auckland values were increasing the fastest, up 2.1% over the past three months and 5.1% higher than last year, with values now 1.9% above the previous market peak.

The old Auckland City continues to be the strongest performer within the Auckland area, up 2.7% over the last three months and 7.2% over the year to 4.4% above the previous market peak.

The North Shore has seen slightly slower value growth but is still 4% up on last year and 0.9% above market peak.

The rest of Auckland has seen values increase on last year between 2.5% (Franklin) to 3.2% (Waitakere) with the exception of Rodney, where values have been volatile over the past few years and sit 1.6% above last year.

In the capital values have fallen over the first part of the  past year before recovering most of the losses since mid-2011, with current values just 0.4% below the same time last year and 6.2% below market peak.

Values have continued their upward trend in Christchurch to 3.7% above the same time last year and just 0.7% below the 2007 peak.

Strong value growth has been especially pronounced in areas immediately surrounding Christchurch, with Waimakariri District up 10.5% over last year and 5.2% above the peak, and Selwyn District up 8.7% year-on-year and 5.3% above peak.

"Areas like the north west of Christchurch continue to benefit from good demand from purchasers," said QV valuer Richard Kolff.

"Open homes are busy and resulting in multiple offer situations for the vendors. This is particularly the case for houses under $400,000 with demand being fuelled by a steady stream of payouts to red zone home owners."

Hamilton has seen values stabilise over the past few months in what QV says is probably a long term trend. Values are now 0.5% above last year and 11% below the market peak.

Tauranga has seen a gradual increase in values over the past year, up 1.1% over that period, but remaining 10.9% below the market peak.

QV valuer Shayne Donovan-Grammer said Tauranga started the year with a good level of market activity, however, "while activity has improved, prices have remained stagnant."

Dunedin has seen values increasing since August 2011 to 3.4% above last year, 4.2% below the market peak.

"The Dunedin property market is seeing increased outside investment due to the affordability of Dunedin values," said QV valuer Tim Gibson.

"Buyers are becoming more active and we are seeing some multiple offer scenarios occurring. The lower to mid-bracket properties are the most popular with increased demand stimulating the growth shown."

While values for the combined provincial centres have slid back over the past three months, there has been some variability between areas. Towards the end of 2011 values appeared to be increasing across most provincial centres in line with the main centres. 

However, in the past few months values have begun to drop again in Whangarei, Rotorua, Gisborne and Wanganui.

Values have remained steady in Napier, New Plymouth and Palmerston North over the past three months and increased over the same period in Hastings and Nelson.

Nelson also differs from other provincial centres in being just 0.3% below the 2007 peak. This is in contrast to New Plymouth (5.7% below peak) through to Queenstown Lakes (17% below), Whangarei (17.5% below) and Gisborne (22.3% below).

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