'Cycle may only be half-way through'

He spoke at the Bankers Association yesterday, where he said price growth of 13% year-on-year in Auckland was muchless than had been seen in previous property booms.

"I don't believe we're looking at a stressed market where a bubble has grown. There are still strong fundamentals that will continue to drive it up."

During the 1970s, growth rates had reached 40% year-on-year, he said. In the 1990s, it was 30%.

He said: "Maybe we're half-way there, maybe not. The economy is different but let's not get carried away and say values are overheated now because in a year's time you'll be screaming."

People should stop talking about a "New Zealand property market", he said, because most centres had not seen much house price growth at all.

Property IQ data shows that cities such as Hamilton and Tauranga are still seeing growth of less than 4% per year.

Even within Auckland, there was a lot of variation, Ingerson said. "It's premature to say the Auckland market needs to bre stopped dead in its tracks. What is happening is not exceptional."

Research shows that buyers had started to baulk at the prices in inner-city suburbs of Auckland over recent months and moved further out, but were starting to filter back in again.

QV's latest data shows that nationwide residential prices increased 8.1% in the year to July, and 3.1% over the past three months. Prices are now 7.5% up on what they were in late 2007, the last market peak. But Ingerson said that was almost entirely driven by the influence of the two biggest cities.