Property

Values moderation ahead

Investor activity is dropping and Auckland’s market is flat-lining but QV’s latest data shows that nationwide property values are still creeping up.

Wednesday, May 02nd 2018

Napier continues to see strong value growth

Nationwide property values rose by just 1.1% over the past three months and, once adjusted for inflation, by 6.4% over the year to April, according to the latest monthly QV House Price Index.

This leaves the nationwide average value at $678,856 in April, as compared to $677,618 in March and $631,147 in April 2017.

QV’s data also shows that values in the country’s biggest market, Auckland, dropped by 0.3% over the past three months and, once adjusted for inflation, by 0.3% over the year to April.

This leaves Auckland’s average value at $1,051,687 in April, as compared to $1,055,992 in March and $1,043,830 in April 2017.

QV general manager David Nagel says nationwide values are rising at a moderate pace with many regional centres continuing to see steady increases.

But he says the rate of growth is continuing to slow, plateau or even drop slightly in the main centres.

Over the past three months, values dropped in Wellington, were flat in Christchurch and went up only slightly in Hamilton, Tauranga and Dunedin.

In contrast, the Hawkes Bay region has been seeing significant value growth in many of its markets.

The Napier market was leading the way, with its average values up by 3.4% over the past three months and by 17.6% year-on-year.

Invercargill has also seen strong value growth, as have a number of provincial markets in both the North and South Island.

Nagel says one reason for this is the continued trend of people seeking a lifestyle change away from the cities and purchasing better valued properties in the regions, particularly those that are within commutable distances of major centres.

“Another reason for the slowdown in value growth can be partly attributed to the usual seasonal slowdown in activity as we approach the winter months.

“But also the fact that many people, particularly investors, are not expecting significant capital growth in the coming months so are less active in the market.”

However, it seems that while regional markets are currently producing strong results, there are signs of weakness ahead.

CoreLogic head of research Nick Goodall says they are starting to see population growth slow in the regional centres.

Further, with extended value growth not matched by wage growth, property is becoming less affordable, especially given a tightening of lending credit policies, he says.

“Property transactions are likely to remain constrained for at least the rest of the year as finance remains harder to acquire.

“However, with strong fundamentals underpinning the market, we’re unlikely to see a significant drop in either volumes or values across our main centres.”

 

Comments

No comments yet

Heartland Bank - Online 6.69
SBS FirstHome Combo 6.74
Wairarapa Building Society 6.95
Unity 6.99
Co-operative Bank - First Home Special 7.04
ICBC 7.05
China Construction Bank 7.09
BNZ - Classic 7.24
ASB Bank 7.24
ANZ Special 7.24
TSB Special 7.24
Unity First Home Buyer special 6.45
Heartland Bank - Online 6.45
China Construction Bank 6.75
TSB Special 6.75
ICBC 6.75
ANZ Special 6.79
ASB Bank 6.79
AIA - Go Home Loans 6.79
Kiwibank Special 6.79
BNZ - Classic 6.79
Unity 6.79
Westpac Special 6.39
China Construction Bank 6.40
ICBC 6.49
SBS Bank Special 6.55
Kiwibank Special 6.55
BNZ - Classic 6.55
Co-operative Bank - Owner Occ 6.55
ASB Bank 6.55
AIA - Go Home Loans 6.55
TSB Special 6.59
Kainga Ora 6.99
SBS FirstHome Combo 6.19
AIA - Back My Build 6.19
ANZ Blueprint to Build 7.39
Credit Union Auckland 7.70
ICBC 7.85
Heartland Bank - Online 7.99
Pepper Money Essential 8.29
Co-operative Bank - Owner Occ 8.40
Co-operative Bank - Standard 8.40
First Credit Union Standard 8.50
Kiwibank 8.50

More Stories

Support for regulation

Monday, March 18th 2024

Support for regulation

REINZ has emphasised the need for property management regulation to Parliament’s Social Services and Community Committee.

A better investment market

Thursday, March 14th 2024

A better investment market

“Reinstatement of interest deductibility starting from the new tax year on 1 April brings property investors back in line with every other business in the country, where interest costs are a legitimate deductible expense," Tim Horsbrugh, New Zealand Property Investors Federation (NZPIF) executive committee member says.

[OPINION] Recessionary times

Thursday, March 14th 2024

[OPINION] Recessionary times

It is not the best out there for many businesses and property sector people. Sales are down across the board, our clients’ confidence is falling, and there is a lot of uncertainty.

Interest rate expectations: It’s not over yet

Thursday, March 07th 2024

Interest rate expectations: It’s not over yet

Most Kiwis think interest rate increases have peaked.