Christchurch market shows signs of slowing

It has released its latest New Zealand Housing and Construction Quarterly, which looks at housing market data.

MBIE manager of modelling and sector trends Bryan Field said there were signs the growth in Christchurch house prices and rents could be easing. "Whether or not the Christchurch housing market is starting to return to a more normal state will remain to be seen. We won’t know until house prices and rents start to dip."

The report said Christchurch had been affected by supply constraints caused by the earthquakes in 2010 and 2011. Over the past four years, average rents in Greater Christchurch had risen 39%, house prices by 28% and dwelling consents by 240%. 

But over 2014, that looked to slow. The rate of annual house price inflation fell from 12% in January to 4% in October. Rental inflation fell from 11% per annum to 4% over the same period. The report said there had been concerns that Christchurch rents would grow to exceed Auckland's but that was now looking less likely.

MBIE said the average increase in national rents over the past year was 3.7%. 

On an annual basis, Canterbury's rental growth for the year to October was 9.1%.  Otago had the second-highest average rental growth in New Zealand, of 5.4%, followed by Auckland with 3.8%. Growth in Bay of Plenty, Wairarapa and Masterton had slowed. 

The West Coast was the only region of New Zealand where rents dropped over the year. 

Four-bedroom homes had the biggest increase in average rent over the year, up 5.6%, followed by homes with five or more bedrooms, up 4.7%.