Limited house price growth the new normal

In its latest Property Focus the bank claims that while residential consents should improve given population growth, and earthquake rebuilding will provide a further boost to the residential construction sector, affordability and serviceability continue to point to limited scope for price rises.

The Property Focus also includes 10 gauges the bank uses to assess the state of the housing market and to look for signs of emerging trends.

Of the 10 gauges, only one - median rent - points to house price rises, while four suggest falls, four suggest either rises or no movement and one suggests either no movement or price falls.

Affordability, little changed over the past nine months, debt repayment, a fall in borrowing and dwindling migration all suggest price falls.

Relative property price movements between New Zealand and Australia, the UK and USA suggests either no change or price falls.

The small - and unexpected - fall in fixed mortgage rates, the supply and demand gap and a lift in section sales, which ANZ says suggests an upcoming rise in building permit issuance, and the amount of available housing all point to either price rises or no change.

The report claims the state of the housing market is a sign of the long, drawn out nature of the recovery after the global financial crisis (GFC) and that "limited house price appreciation is likely to be the norm."