QV says NZ home values rose 12% in year to April

Wednesday 4th May 2016

New Zealand residential property values increased in the year through April, aided by low interest rates.

The average value of a New Zealand home rose 12 percent to $568,058 in April from the year earlier, up from an 11.4 percent rate of increase in the March year, according to state-owned valuer, Quotable Value. Growth in Auckland house values slowed to a 16.5 percent annual pace in April, from a 16.9 percent in March, taking the average value in the region to $942,760.

Auckland realtor Barfoot & Thompson issued its own April data today and reported lower sales volumes in a "constrained" market environment.

Auckland's property market has been a bugbear for regulators as a shortage of supply and rapid inbound migration pushed up prices, stoking concerns about the affordability of housing. The government and the Reserve Bank last year introduced measures to try and cool the city's property market. However, QV said today that low interest rates were stimulating demand, after the Reserve Bank in March cut the benchmark to a record low 2.25 percent.

“All the main centres around New Zealand and many regional centres have seen home values increase during April, with the promise of continued low record interest rates providing confidence in the housing sector,” said QV spokesperson Andrea Rush. “All parts of the Auckland region are rising again, however at a slower rate than many other upper North Island centres such as Hamilton, Tauranga and Rotorua as well as in the districts surrounding areas like the Thames-Coromandel, Waipa, Hauraki, Matamata-Piako and Waikato districts.”

QV said home values across Auckland are on the rise again, ending a downward trend in some parts of the market over the past six months following regulatory changes to curb investor activity in the region and restrictions on the flow of capital out of China introduced late last year.

"Throughout April we have been observing renewed optimism in the housing market as interest rates remain at historic lows and capital gains are still being realised at record levels," said QV valuer James Wilson.

In other urban centres, Wellington values lifted 9.9 percent in the past year to $599,482, Christchurch advanced 3.4 percent to $488,943, Hamilton jumped 25 percent to $471,072, Tauranga rose 22 percent to $577,494 and Dunedin gained 9 percent to $317,714.

Sales volumes for April were lower than March, most likely due to school holidays and Anzac weekend during the month, as many buyers take a holiday during that period, QV said.

BusinessDesk.co.nz

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