After a period of declining value growth, values in the Auckland region increased by 0.7% in the year to January 2018 and by 1.6% over the past three months, leaving the region’s average value at $1,054,974.
This is the highest rate of growth since November 2016 – although once adjusted for inflation values dropped by 0.9% over the past year.
The growth in values was spread across the region with every market area recording increases.
Auckland City - Islands led the way, with its values up by 12.6% over the past year and by 4.7% over the last three months.
It was followed by Auckland City - East where values grew by 2.9% year-on-year and by 2.7% over the past three months.
But QV’s Auckland property consultant, William Liew, says that the signs do suggest that the heat has been taken out of the market and buyers are showing less urgency.
“We have also seen the ongoing impact of the LVR restrictions, changes of lending criteria and uncertainly with the change of government, which have contributed to a cooling in the Auckland market.”
Meanwhile, QV’s House Price Index shows that nationwide property values for January increased by 4.7% over the past year (once adjusted for inflation) and by 3.8% over the past three months.
This left the national average value at $671,531 in January 2018, as compared to $669,565 in December.
QV general manager David Nagel says January has seen values continue to rise in many places around New Zealand.
“But values have dropped in others and in general activity has been slower in many places over the holiday season.”
Values in Auckland are now rising and the Wellington market continues to rise – although value growth has slowed in the Hutt Valley.
Of the other main centres, the Christchurch market remains flat while the Dunedin market continues to see a trend of steady value growth.
Nagel says market activity across the nation appears to be picking up now that people have returned to work from the holiday season.
“The easing of the LVR restrictions, along with continued strong net migration, low interest rates, and a shortage of housing supply means it’s likely we can expect moderate value growth to continue during February and March which are annually the busiest months in the housing market.”
Commentators have noted that the housing market has been seeing some resurgence in recent months, but most do not expect the market to start booming again.
Westpac chief economist Dominick Stephens says there will be a couple of months that are positive for the market.
But after that, the new Government’s policy changes, along with slowing migration and a comparative rise in interest rates, will start to have an impact.
“That leads us in one direction… House prices beyond this short term blip are likely to fall, or will have a rate of growth below zero.”
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